Oceania Healthcare says its bankers won't let it tell the market what its banking covenants are, and the interest coverage ratio (ICR) one in particular.
NZ Regco is wrong. Banking covenants are important and disclosable information. The question is it relevant and liable to be disclosed. Then when should it be disclosed. If one is well within its banking covenants then it is likely not that relevant. However if covenant compliance becomes more marginal then it may affect the share value if it was known to the market. In that case it is a disclosable matter even if covenants have not (yet?) been breached. Dirk Hudig
The company is in breach of its covenants and bankers do not want the breach amount disclosed. Neither does the company. RV’s model is unsustainable and they simply do not know what to do.
To be clear, as my story reports, Oceania has said it has met all its covenants, even though they haven't spelled out what those covenants are. I have no reason to doubt what they say is true.
NZ Regco is wrong. Banking covenants are important and disclosable information. The question is it relevant and liable to be disclosed. Then when should it be disclosed. If one is well within its banking covenants then it is likely not that relevant. However if covenant compliance becomes more marginal then it may affect the share value if it was known to the market. In that case it is a disclosable matter even if covenants have not (yet?) been breached. Dirk Hudig
The company is in breach of its covenants and bankers do not want the breach amount disclosed. Neither does the company. RV’s model is unsustainable and they simply do not know what to do.
To be clear, as my story reports, Oceania has said it has met all its covenants, even though they haven't spelled out what those covenants are. I have no reason to doubt what they say is true.
Have they met their covenants or have the bank’s waived or amended some requirements?
They have said they have met their covenants.