Fri 28th Feb 2014 - Breaking News - Punch outlines dates for administrative receivership Punch outlines dates for administrative receivership: Punch Taverns has issued a timetable for putting itself into administrative receivership should it be unable to agree a consensual restructuring of its debts, held in two securitisation vehicles, Punch A and Punch B, with bondholders. A Punch source told Propel this morning that the publication of a timetable for administrative receivership is to focus the mind of bondholders on the need to agree a consensual restructuring. The company stated this morning: “Neither securitisation has acquired bonds nor benefitted from EBITDA support in the most recent quarter. Underlying trading for the half year is expected to be broadly in line with management expectations and consequently, while we cannot predict with certainty what the DSCR (Debt Service Cover Ratio) level will be, we anticipate that one or both securitisations will fail their respective DSCR financial covenants with respect to the covenant testing date of 1 March 2014 when they are next tested and reported on 15 April 2014. In the absence of a consensual restructuring, failure to achieve the second quarter DSCR financial covenant in the relevant securitisation when reported on 15 April 2014 would result in a default in the relevant securitisation within a further 30 days. Moreover, failure to effect a restructuring in the near-term will lead to a default in both the Punch A and Punch B securitisation, which is expected to have a material negative impact on the business, including material dissynergies and disruption to the business. As a result, it is in the interests of all parties to agree a consensual restructuring ahead of the next covenant reporting date of 15 April 2014, and to put in place a sustainable long-term capital structure for the securitisations.” Punch executive chairman Stephen Billingham added: “We are convinced that a consensual restructuring is by far the best outcome for all stakeholders, and we will continue to work with all stakeholders to reach a consensus on the restructuring. No-one can be in any doubt about the consequences of failing to agree a consensual deal. We call on all parties to work together constructively to agree a restructuring. Everyone has something to gain by agreeing a restructuring that will retain the material financial synergies and provide certainty and stability for the business from which all stakeholders will benefit.” Punch’s proposals for restructuring company debts were withdrawn earlier this month after it became clear that bondholders would vote down the company’s proposals, triggering a potential administration process. Key bondholders are expected to table their own restructuring plan shortly, with a debt of equity swap likely to be the thrust of their alternative proposals. Meanwhile, Punch reported trading has continued in line with management expectations with core estate like-for-like net income for the half year expected to be broadly in line with the 1.5% growth reported for the first 20 weeks to 4 January 2014. Management expectations for the full year remain unchanged with the core estate expected to deliver like-for-like net income growth of up to 1%. The pub investment and non-core pub disposal programmes remain on track with full year capital investment expected to be circa £45m and disposal proceeds anticipated to be circa £100m.