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Debt and investments

Edenred's business model, which generates a high volume of cash and consumes a small amount of capital, enables the Group to maintain a strong financial position. 

On this section, access to

2016 Edenred Key data for credit investors and analysts

Rating  Rating

Edenred has been rated BBB+/A-2; Outlook stable, i.e. “Strong Investment Grade” by Standard & Poor’s on June 9, 2010. The rating has been confirmed by Standard & Poor’s in a press release dated April 27, 2017.
This rating is based on a multi-criteria analysis, appraising:

  • the business profile of the Group, rated “Strong”, reflecting the Edenred’s worldwide leadership position and its growth prospects on the prepaid corporate services market;
  • its financial position, rated “Intermediate”, in respect of Edenred’s sustainable financial position and its cash-flows generating business model.

Debt structure at end december 2016  Debt structure at end december 2016

Breakdown of net debt

Breakdown by type of debt

Breakdown by type of interest rate

Amount (in €million) ">
Focus on bonds issues
Issue date Currency Annual coupon Maturity
3/10/2015 EUR 500 1.375% 3/10/2025 10 years
10/30/2013 EUR 250 2.625% 10/30/2020
7 years
5/23/2012 EUR 225 3.750% 5/23/2022
10 years
10/6/2010 EUR 510 3.625% 10/6/2017
7 years

 

Breakdown by due date

Gross debt cost as of December 31, 2016

Before hedging After hedging
3.27% 2.52%

 

Confirmed lines of credit

  
In April 2013, Edenred announced the signature of a 5-year syndicated credit facility for €700 million. The new facility has increased the average maturity of the Group’s resources by replacing the existing €578 million in confirmed lines of credit, which were set up in June 2010 and scheduled to expire in June 2014.
On June 20, 2014, Edenred has amended its above-mentioned syndicated credit facility to extend it with a consortium of 16 banks. This operation allows Edenred to benefit from better financing conditions, which reflect the market trust with regard to the Group's financial health.
The new 5-year-maturity credit is extended to June 2019 and allows Edenred to increase the average maturity of the Group’s resources.

On July 21st 2016, Edenred successfully signed with 14 banks an amendment agreement to its €700 million 5-year Revolving Credit Facility. Thanks to this operation, the Group takes advantage of significantly more favorable financing conditions. It extends the maturity of the facility by 2 years from June 2019 to July 2021 whilst reducing significantly the spread. The amendment also reinstates the two one-year extension options exercisable at the request of Edenred and discretion of the banks.

Investments  Investments

The Group’s negative working capital amounted to €2.8 billion at December 31, 2016.

Negative WCR breakdown as of December 31, 2016


* Restricted cash are funds which correspond to prepaid service vouchers under special regulations. They are excluded when calculating the net debt. 

Breakdown of the financial investments as of December 31, 2016

 


Note: The remuneration from the investments is recorded as financial revenue.

A cautious investment policy

To manage its treasury, the Group’s market risk management policy is designed to mitigate the capital, the liquidity and the counterparty risks.

Hence, most of the financial investments are made in monetary instruments (fixed-rate time deposits, term accounts, retail certificates of deposit or interest-bearing demand deposits).

Exposure to counterparty risk is reduced by:

  • dealing only with leading counterparties according to correlated country risks;
  • using a wide range of counterparties;
  • setting exposure limits by counterparty;
  • using a monthly reporting procedure to track the concentration of counterparty risk and the credit quality of the various counterparties (based on their credit ratings).

The majority of the Group’s available cash is managed under a centralized cash management scheme. This organization helps reduce the Group’s risk exposure through centralized, periodic monitoring.

Bond issues prospectus
Issue date Currency Amount (in million) Rating
(Standard & Poor's)
Annual coupon Maturity Press release Official
prospectus
3/22/17 EUR 500 BBB 1.875%  10 years

3/10/15 EUR 500 BBB 1.375% 10 years

10/30/13 EUR 250 BBB 2.625% 7 years

5/23/12 EUR 225 BBB 3.750% 10 years

10/6/10 EUR 510 BBB 3.625% 7 years