I am not sure what about their debt is concerning you given what they do and how they do it.
Looking back at their annual reports, I plucked 2015 (at random) and compared it to 2018. So below I have written 2015 vs 2018
Total debt: 12.2 billion vs 15.0 billion
Gearing: 40.2%. vs. 35.2%
Weighted av maturity: 7.8 years. vs. 9.2 years
US debt cost: 3.8%. vs. 4.4%
AUD debt cost: 5.3%. vs. 4.9%
FFO/debt: 7.9%. vs. 8.9%
Looks like an overall improvement to my eyes.
So yes they have more total debt, but that’s because they are bigger and have more toll roads. As long as they keep expanding, and I assume that is what shareholders want, I would expect their total debt to increase but as long as the other metrics remain constant, bring it on I say. But I am biased.
And owning their shares makes that little bing you hear every time when you travel through one of their toll gates so much more tolerable.
TCL Price at posting:
$12.06 Sentiment: None Disclosure: Held
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