250827.mbx

250827.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Wednesday, August 27, 2025, Vol. 26, No. 171 Headlines F R A N C E PICARD BONDCO: Fitch Affirms 'B' Long-Term IDR, Outlook Stable I R E L A N D FORTUNA 2024-1: Fitch Affirms 'BB-sf' Rating on Class F Notes ST. PAUL'S IX: Fitch Affirms 'B-sf' Rating on Class F-R Notes N E T H E R L A N D S ACR I BV: Moody's Downgrades CFR to Caa1, Outlook Remains Negative R U S S I A ARTEL ELECTRONICS: Fitch Affirms 'B' LT IDR, Alters Outlook to Neg. U N I T E D K I N G D O M 2TECH LIMITED: FRP Advisory Named as Administrators BUCKINGHAM GROUP: BK Plus Limited Named as Administrator CALON CARDIO: Stones & Co Insolvency Named as Administrators CLAIRE'S ACCESSORIES: Interpath Ltd Named as Joint Administrators CLAIRE'S EUROPEAN SERVICES: Leonard Curtis Named as Administrators CLAIRE'S EUROPEAN: Interpath Ltd Named as Joint Administrators DRINKS OF MANCHESTER: Clark Business Named as Joint Administrators VERSARIEN GRAPHENE: Leonard Curtis Named as Joint Administrators - - - - - =========== F R A N C E =========== PICARD BONDCO: Fitch Affirms 'B' Long-Term IDR, Outlook Stable -------------------------------------------------------------- Fitch Ratings has affirmed Picard Bondco S.A.'s (Picard) Long-Term Issuer Default Rating (IDR) at 'B' with a Stable Outlook and senior unsecured rating for the EUR310 million fixed-rate notes at 'CCC+' with a Recovery Rating of 'RR6'. Fitch has affirmed Picard Groupe SAS's senior secured EUR650 million fixed-rate notes and Lion/Polaris Lux 4 S.A.'s senior secured EUR775 million floating-rate notes at 'B+' / 'RR3'. Picard's aggressive financial policy constrains the rating. Fitch expects EBITDAR leverage to remain close to the top threshold for the rating at about 7x through FY28 (March year-end). However, the company's robust business model and effective cost management support high profitability and sustained positive FCF despite the challenging environment. The Stable Outlook reflects Fitch's expectation of a steady operating performance, high but sustainable leverage, and adequate coverage metrics. Picard's strong liquidity profile provides flexibility to manage its upcoming vendor loan and second lien maturities in 2027. Key Rating Drivers High Leverage Constrains Rating: Fitch expects Picard's EBITDAR leverage to remain high at around 7.0x until the end of FY27, leaving no room for additional debt at the current rating level. Fitch reflects Picard's flexible lease terms and IFRS lease liabilities in its leverage calculations, in line with its new criteria. This adjustment reduced calculated gross leverage by 0.5x, compared with its earlier method, where Fitch capitalised its lease proxy using an 8x multiple. Stalled Vendor Loan Refinancing: Fitch previously expected Picard's leverage to drop by mid-2025, assuming the vendor loan would be repaid with cash proceeds from a minority stake sale at IGZ level. The vendor loan matures in 2027, and Fitch treats it as debt. The sale has been delayed but may occur in the coming months. Completion of the sale would bring leverage down to 6.8x in FY26 and 6.5x in FY27, providing adding adequate leverage headroom under the rating. Due to ongoing uncertainty about the vendor loan take-out, Fitch continues to include it in its leverage calculations. Financial Policy Reset Not Evident: After the December 2024 transaction, through IGZ, the Zouari family owns 50.4% of Picard and ICG owns 49.6%. The sale marked the exit of Lion Capital, the company's main shareholder, which led frequent dividend recapitalisations. Fitch views the funding of Lion's buyout by IGZ as aggressive, adding debt at Picard and introducing shareholder and vendor loans outside the restricted group. Although the new ownership could lead to a more conservative financial policy, the new owners will need to take creditor-friendly actions before Fitch incorporates any positive elements in its credit view, given the initial re-leveraging transaction. Strong Profitability: EBITDA margin recovered in FY25 to 12.8% as energy cost eased, after bottoming out in FY24 at 12%. Picard slightly increased its gross margin above 44% and grew market share by adapting its offering for price-conscious shoppers. Selective price cuts and adapted offerings increased volume (+1.2%) and partly offset lower average basket size (-2.0%), in turn mainly due to calendar effects. Fitch expects Picard to maintain high margins and protect market share while adapting effectively to consumer trends. Picard's profit margins are high for the sector, supported by its focus on own-brand products, premium offerings, and structurally profitable asset-light expansion. Steady Sales Growth: Picard's sales grew only 1.2% in FY25, below Fitch's assumed 3%. However, Fitch still expects revenue will increase an average of 3%-4% in FY26-FY29, due to modest like-for-like growth and store additions. Picard has a strong record of steady sales growth in France, driven by its diversified and frequently renewed frozen food range, which meets various consumer needs while retaining repeat customers. Like-for-like sales grew an average of 1.6% annually from FY17-FY25; Fitch expects a slightly lower rate of 1% through FY29. Picard is well positioned to keep opening new stores to expand its physical presence, both directly operated and franchised. FCF Supports Cash Accumulation: Fitch expects Picard to generate positive annual average FCF of around EUR50 million in FY26-FY29 (around 2.3% of sales), supported by limited working capital swings and capex needs. The strong cash flow generation differentiates Picard from many of its peers in food retail, offsetting its high debt levels. Robust Business Model: Picard's leadership in a niche market and highly profitable own brand continue to underpin its business model. The group was resilient during the pandemic and in the recent inflationary environment as its price increases were only partially offset by a decrease in volumes, while it successfully increased its volume more recently offsetting basket average price decline. Peer Analysis Picard's overall profile remains weaker than that of larger food retail peers, such as Bellis Finco plc (ASDA; B+/Stable) or Market Holdco 3 limited (Morrisons; B/Positive), due to its smaller scale and weaker diversification in non-food products and services. Picard is also smaller in sales than UK frozen food specialist WD FF Limited (Iceland; B/Stable), but its materially stronger profitability leads to an equivalent level of EBITDAR. Picard's gross leverage at 7.4x at end-FY25 remain higher than its peers. Iceland's EBITDAR gross leverage has fallen to about 5x in FY25. Fitch also expects Morrisons to deleverage to near 6.0x and ASDA to below 5.0x in FY25. However, Picard remains comparable in terms of fixed charge coverage of around 1.8x. Picard has strong brand awareness and customer loyalty, which is key for its positioning as a market leader in the French frozen food retail sector. Picard also has high profitability (EBITDAR margin of around 17% versus Iceland's 7%), due to its unique business model focused on own-brand products and premium positioning. This makes it more comparable with food manufacturers than its immediate food retailing peers. This differentiating factor results in superior cash flow generation that supports Picard's financial flexibility and satisfactory liquidity. Key Assumptions - Average revenue growth of 3.5% over FY26-FY29, driven by 1% Lfl and store expansion and franchise growth - Fitch continues to assume the same number of store openings per year (around 40) - EBITDA margin averaging at 13.0% in over FY26-FY29 (FY25: 12.8%) - Capex averaging 3.1% of revenue over FY26-FY29 - Slightly negative working capital movements in FY26-FY29 - EUR120 million Vendor Loan maturing in December 2027 treated as debt, refinanced with a similar instrument - EUR310 million unsecured notes are refinanced at market rate by mid-2026 Recovery Analysis Fitch assumes that Picard would be considered a going-concern (GC) in bankruptcy and that it would be reorganised rather than liquidated. Fitch has assumed a 10% administrative claim in the recovery analysis. In its bespoke GC recovery analysis, Fitch estimates post-restructuring EBITDA available to creditors of about EUR190 million, increased by EUR10 million compared to its previous analysis due to the expansion in the store network seen in the past three years leading to its assessment of a marginally increased residual EBITDA value at distress derived from a larger network of mostly owned stores. Fitch also assumes a fully drawn EUR75 million RCF prior to distress. Fitch has maintained a distressed enterprise value/EBITDA multiple at 6.0x, which reflects Picard's structurally cash-generative business operations, despite its small scale. Its waterfall analysis generates a ranked recovery for Picard's existing EUR1.4 billion senior secured notes in the 'RR3' category, resulting in a 'B+' rating, one notch above the IDR. The Recovery Rating of its EUR310 million senior unsecured notes remains 'RR6', with a rating of 'CCC+', two notches below the IDR. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Deteriorating competitive position or sustained erosion in like-for-like (LFL) sales growth, EBITDA and free cash flow margin, for example, due to the inability to manage cost inflation, leading to the inability to deleverage - Subdued operating performance or evidence of a more aggressive financial policy, including material dividend distributions leading to EBITDAR leverage remaining above 7.0x on a sustained basis - Diminished financial flexibility, due to a loss of financial discipline, reduced liquidity headroom or operating EBITDAR fixed-charge coverage permanently below 1.5x - (CFO-Capex)/Debt remaining below 2.5% on a sustained basis - Absence of credible refinancing options 12 months ahead of the unsecured notes maturity Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Continuation of solid operating performance, for example, reflected in LFL revenue increases and rising EBITDA with strong free cash flow margins in the mid-single digits - EBITDAR leverage below 5.5x on a sustained basis, driven mostly by debt prepayments, reflecting a commitment to more conservative capital allocation - Operating EBITDAR fixed-charge coverage above 2x on a sustained basis Liquidity and Debt Structure Picard's liquidity is comfortable, with EUR152 million of Fitch-adjusted unrestricted cash as of March 2025. The RCF of EUR75 million further improves the liquidity profile. Low capex intensity and manageable working capital outflows provide for healthy positive FCF generation that Fitch estimates will contribute to a continuous liquidity improvement. However, the position is subject to its 2027 unsecured note refinancing and currently unclear prospects of its 2027 vendor loan repayment via new equity. Issuer Profile Picard is a French food retailer with a leading market share of 20% in the highly specialised and niche frozen-food market. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Picard Groupe SAS senior secured LT B+ Affirmed RR3 B+ Picard Bondco S.A. LT IDR B Affirmed B senior unsecured LT CCC+ Affirmed RR6 CCC+ Lion/Polaris Lux 4 S.A. senior secured LT B+ Affirmed RR3 B+ ============= I R E L A N D ============= FORTUNA 2024-1: Fitch Affirms 'BB-sf' Rating on Class F Notes ------------------------------------------------------------- Fitch Ratings has upgraded Fortuna Consumer Loan ABS 2023-1 Designated Activity Company's (Fortuna 2023-1) class C, D and E notes and affirmed the class B notes. Fitch has also affirmed Fortuna Consumer Loan ABS 2024-1 Designated Activity Company's (Fortuna 2024-1) notes. Entity/Debt Rating Prior ----------- ------ ----- Fortuna Consumer Loan ABS 2023-1 Designated Activity Company B XS2585848992 LT AAAsf Affirmed AAAsf C XS2585849297 LT AAAsf Upgrade AA+sf D XS2585849370 LT AAsf Upgrade Asf E XS2585849453 LT BBB+sf Upgrade BBB-sf Fortuna Consumer Loan ABS 2024-1 Designated Activity Company A XS2746123558 LT AAAsf Affirmed AAAsf B XS2746464465 LT AAsf Affirmed AAsf C XS2746465272 LT Asf Affirmed Asf D XS2746465439 LT BBBsf Affirmed BBBsf E XS2746465785 LT BB+sf Affirmed BB+sf F XS2746465868 LT BB-sf Affirmed BB-sf Transaction Summary The transactions are true-sale securitisations of a pool of unsecured consumer loans sold by auxmoney Investments Limited. The transactions' 12-month revolving periods have ended. The securitised consumer loan receivables are derived from loan agreements between Sud-West-Kreditbank Finanzierung GmbH (SWK) and individuals in Germany and brokered by auxmoney GmbH via its online lending platform. KEY RATING DRIVERS Asset Performance Fits Expectations: Fortuna 2023-1's portfolio composition has migrated towards its limits in terms of score-class distribution, meaning borrower credit quality has clearly deteriorated. Nevertheless, arrears and default performance of both transactions is comparable and in line with other Fitch-rated Fortuna deals. Performance of both transactions is in line with its base case expectations. Consequently, Fitch has maintained the current remaining life default base cases at 12.5% for Fortuna 2023-1 and 11.6% for Fortuna 2024-1 with a multiple of 3.8x for both deals. Base case recoveries also remain at 33% for both transactions with a haircut of 55%. CE Build-up Drives Upgrades: Fortuna 2023-1 has been amortising sequentially since the end of the revolving period, leading to a build-up of credit enhancement (CE) compared with the last surveillance review. CE ranged between 18% and 70% for Fortuna 2023-1's class E to B notes compared with 12% and 67% at the last review. The class A notes were repaid in June 2025. The CE build-up has driven the upgrades. Fortuna 2024-1 has been paying pro-rata since the end of its revolving period as no sequential amortisation trigger has been hit. Consequently, CE has remained stable, leading to the affirmation of the notes. Servicing Continuity Risk Addressed: CreditConnect GmbH (not rated), a subsidiary of auxmoney, is the servicer, with some servicing duties performed by SWK. The deals do not have a back-up servicer, but do have a back-up servicing facilitator. Fitch believes that the back-up servicer facilitator, the split of servicing duties between two entities, the high level of standby arrangements and the liquidity reserve reduce the risk of servicer discontinuity and payment interruptions of senior expenses and interest on the rated notes. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Unanticipated increases in default rates or decreases in recovery rates producing larger losses than its assumptions could result in negative rating action on the notes. The sensitivities below describe the model-implied impact of a change in one of these input variables. Fortuna 2023-1: Expected impact on the notes' ratings of increased defaults (class B/C/D/E) Increase default rates by 10%: 'AAAsf'/'AAAsf'/'AA-sf'/'BBB+sf' Increase default rates by 25%: 'AAAsf'/'AAAsf'/'A+sf'/'BBBsf' Increase default rates by 50%: 'AAAsf'/'AAsf'/'A-sf'/'BB+sf' Expected impact on the notes' ratings of reduced recoveries (class B/C/D/E) Reduce recovery rates by 10%: 'AAAsf'/'AAAsf'/'AAsf'/'BBB+sf' Reduce recovery rates by 25%: 'AAAsf'/'AAAsf'/'AAsf'/'BBB+sf' Reduce recovery rates by 50%: 'AAAsf'/'AAAsf'/'AA-sf'/'BBBsf' Expected impact on the notes' ratings of increased defaults and reduced recoveries (class B/C/D/E) Increase default rates by 10% and reduce recovery rates by 10%: 'AAAsf'/'AAAsf'/'AA-sf'/'BBBsf' Increase default rates by 25% and reduce recovery rates by 25%: 'AAAsf'/'AA+sf'/'Asf'/'BBB-sf' Increase default rates by 50% and reduce recovery rates by 50%: 'AAAsf'/'AA-sf'/'BBB+sf'/'BBsf' Fortuna 2024-1: Expected impact on the notes' ratings of increased defaults (class A/B/C/D/E/F) Increase default rates by 10%: 'AA+sf'/'AA-sf'/'BBB+sf'/'BBB-sf'/'BB+sf'/'BBsf' Increase default rates by 25%: 'AAsf'/'Asf'/'BBBsf'/'BB+sf'/'BBsf'/'Bsf' Increase default rates by 50%: 'A+sf'/'A-sf'/'BBB-sf'/'BBsf'/'Bsf'/'NRsf' Expected impact on the notes' ratings of reduced recoveries (class A/B/C/D/E/F) Reduce recovery rates by 10%: 'AA+sf'/'AA-sf'/'A-sf'/'BBBsf'/'BB+sf'/'BBsf' Reduce recovery rates by 25%: 'AA+sf'/'AA-sf'/'BBB+sf'/'BBB-sf'/'BB+sf'/'BBsf' Reduce recovery rates by 50%: 'AA+sf'/'AA-sf'/'BBB+sf'/'BBB-sf'/'BBsf'/'B+sf' Expected impact on the notes' ratings of increased defaults and reduced recoveries (class A/B/C/D/E/F) Increase default rates by 10% and reduce recovery rates by 10%: 'AA+sf'/'A+sf'/'BBB+sf'/'BBB-sf'/'BBsf'/'BB-sf' Increase default rates by 25% and reduce recovery rates by 25%: 'AAsf'/'Asf'/'BBB-sf'/'BB+sf'/'BB-sf'/'CCCsf' Increase default rates by 50% and reduce recovery rates by 50%: 'Asf'/'BBBsf'/'BB+sf'/'B+sf'/'NRsf'/'NRsf' Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Lower defaults and smaller losses could lead to positive rating action. Fortuna 2023-1's class B and C notes and Fortuna 2024-1's class A notes are already at the highest rating on Fitch's scale and cannot be upgraded. For the remaining notes in both transactions, a simultaneous 25% decrease in defaults and 25% increase in recoveries could result in up to three-notch upgrades. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Fortuna Consumer Loan ABS 2023-1 Designated Activity Company Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. Prior to the transaction closing, Fitch reviewed the results of a third party assessment conducted on the asset portfolio information and concluded that there were no findings that affected the rating analysis.Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. Fortuna Consumer Loan ABS 2024-1 Designated Activity Company Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. Prior to the transaction closing, Fitch reviewed the results of a third party assessment conducted on the asset portfolio information and concluded that there were no findings that affected the rating analysis. Prior to the transaction closing, Fitch conducted a review of a small targeted sample of the originator's origination files and found the information contained in the reviewed files to be adequately consistent with the originator's policies and practices and the other information provided to the agency about the asset portfolio. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. ST. PAUL'S IX: Fitch Affirms 'B-sf' Rating on Class F-R Notes ------------------------------------------------------------- Fitch Ratings has upgraded St. Paul's CLO IX DAC's class C-R notes to 'A+sf' from 'Asf' and affirmed the rest. Entity/Debt Rating Prior ----------- ------ ----- St. Paul's CLO IX DAC A-1-R XS2443906172 LT AAAsf Affirmed AAAsf A-2-R XS2443906503 LT AAAsf Affirmed AAAsf B-R XS2443906255 LT AAsf Affirmed AAsf C-R XS2443906768 LT A+sf Upgrade Asf D-R XS2443906925 LT BBB-sf Affirmed BBB-sf E-R XS2443907147 LT BB-sf Affirmed BB-sf F-R XS2443907493 LT B-sf Affirmed B-sf Transaction Summary St. Paul's CLO IX DAC is a cash flow CLO comprising mostly senior secured obligations. The transaction closed in May 2018 and was subject to a reset in March 2022. It is managed by Intermediate Capital Managers Limited and currently in its reinvestment period until October 2026. KEY RATING DRIVERS Performance Better Than Expected Case: Since Fitch's last rating action in September 2024, the portfolio's performance has improved, with defaulted assets now 0.3% of par, compared with 1.7% at the latest review. Based on the last trustee report dated 9 July 2025, the transaction is failing its Fitch 'CCC' and S&P 'CCC' tests, by 2.2% and 0.2% respectively. The transaction is currently about 1% above par and passing all other tests, with a wide margin on the current weighted average rating factor, weighted average recovery rate and weighted average spread covenants. All this underpins today's rating actions. Manageable Refinancing Risk: The transaction has manageable near- and medium-term refinancing risk, with only 1.7% of the assets in the portfolio maturing by end-2026 and 6.5% in 2027, as calculated by Fitch, in view of large default-rate cushions for each class of notes. The transaction's performance has resulted in an increase on the break-even default-rate cushions versus the last review, which also drives the upgrade of the class C-R notes. High Recovery Expectations: Senior secured obligations comprise 96.9% of the portfolio. Fitch views the recovery prospects for these assets as more favourable than for second-lien, unsecured and mezzanine assets. The Fitch-calculated weighted average recovery rate of the current portfolio is 61.8%. Diversified Portfolio: The portfolio is well-diversified across obligors, countries and industries. The top 10 obligor concentration, as calculated by Fitch, is 15.6%, and no obligor represents more than 2.2% of the portfolio balance. Exposure to the three-largest Fitch-defined industries is 32.3% as calculated by the trustee. Fixed-rate assets reported by the trustee are at 6.9% of the portfolio balance, which is well below the maximum covenant of 15%. Cash Flow Analysis: Fitch used a customised proprietary cash flow model to replicate the principal and interest waterfalls and the various structural features of the transaction, and to assess their effectiveness, including the structural protection provided by excess spread diverted through the par-value and interest-coverage tests. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade Downgrades, which are based on the current portfolio, may occur if the loss expectation is larger than assumed, due to unexpectedly high levels of default and portfolio deterioration. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade Upgrades may result from stable portfolio credit quality and deleveraging, leading to higher credit enhancement and excess spread available to cover losses in the remaining portfolio. USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10 Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action. DATA ADEQUACY Fitch has checked the consistency and plausibility of the information it has received about the performance of the asset pool and the transaction. Fitch has not reviewed the results of any third-party assessment of the asset portfolio information or conducted a review of origination files as part of its ongoing monitoring. The majority of the underlying assets or risk-presenting entities have ratings or credit opinions from Fitch and/or other Nationally Recognised Statistical Rating Organisations and/or European Securities and Markets Authority- registered rating agencies. Fitch has relied on the practices of the relevant groups within Fitch and/or other rating agencies to assess the asset portfolio information or information on the risk-presenting entities. Overall, and together with any assumptions referred to above, Fitch's assessment of the information relied upon for the agency's rating analysis according to its applicable rating methodologies indicates that it is adequately reliable. ESG Considerations Fitch does not provide ESG relevance scores for St. Paul's CLO IX DAC. In cases where Fitch does not provide ESG relevance scores in connection with the credit rating of a transaction, programme, instrument or issuer, Fitch will disclose any ESG factor that is a key rating driver in the key rating drivers section of the relevant rating action commentary. ===================== N E T H E R L A N D S ===================== ACR I BV: Moody's Downgrades CFR to Caa1, Outlook Remains Negative ------------------------------------------------------------------ Moody's Ratings downgraded ACR I B.V.'s (AnQore or the company) corporate family rating to Caa1 from B3 and probability of default rating to Caa1-PD from B3-PD. Concurrently, Moody's downgraded the instrument ratings of AnQore B.V.'s senior secured bank credit facilities to Caa1 from B3. The outlook on both entities remains negative. RATINGS RATIONALE The rating action reflects Moody's expectations that the company will continue to generate negative Moody's-adjusted free cash flow over the next 12 to 18 months despite this year's reduction in gross debt. In addition, Moody's forecasts the company's Moody's-adjusted gross leverage to remain higher than commensurate for the previous rating. Moody's views AnQore's capital structure as unsustainable and Moody's believes there are refinancing risks associated with its debt, which matures in late 2027. Moody's anticipates that the company will continue to face pressure over the next 12-18 months due to a global oversupply of acrylonitrile and macroeconomic uncertainties. Soft European demand weighs negatively on many end markets for acrylonitrile and other chemicals. Since the last rating action on AnQore in February this year, the prospects of an uptick in demand worsened because of the uncertainties around the US tariffs, which weakened consumer sentiment and business investment. Moody's forecasts the company's Moody's-adjusted gross leverage (excluding the joint-venture disposal gain) will exceed 8.5x in 2025 and improve between of 7x-8x by 2026—approximately one year ahead of its debt maturities. Moody's expects this level of projected gross leverage to make a potential refinancing challenging, particularly given Moody's forecasts include moderate volume growth assumptions, which may not materialize under a more pessimistic scenario. Generally, there are high uncertainties attached to Moody's forecasts. Self-help measures are unlikely to deliver a meaningful increase in EBITDA, as the company's cost structure is already relatively lean, leaving future improvements dependent on a market recovery, which is uncertain at this stage. In the first half of 2025, sales volumes increased moderately compared to the same period previous year. However, company-adjusted pro-forma EBITDA fell to around EUR21 million in H1-2025 from EUR36 million in H1-2024. Earlier this year, AnQore repaid EUR80 million of its EUR300 million senior secured term loan B2 following the sale of its shares in Circle Infra Partners. As part of the transaction, lenders approved the exchange of the net leverage covenant against a minimum liquidity covenant until Q1 2026. OUTLOOK The negative outlook on AnQore reflects the weak rating positioning and the increased refinancing risks. LIQUIDITY Moody's views AnQore's liquidity as weak. Moody's forecasts negative Moody's-adjusted FCF (after interest costs) over the next 12-18 months. As of the end June 2025, the company had around EUR16 million in cash and cash equivalent on balance sheet, and access to an EUR55 million senior secured revolving credit facility (RCF) of which EUR35 million were undrawn. Furthermore, the company has also access to a EUR70 million factoring facility (EUR39 million were drawn as of June). However, the availability of the factoring program depends also on the amount of receivables that qualify as eligible. The company's cash balance experiences intra-year swings driven by the timing of interest payments and fluctuations in working capital. Until Q1-2026, the company needs to comply with a minimum liquidity covenant (the definition of liquidity is broader than just cash on balance) of EUR25 million. Moody's believes that there is a risk that AnQore could breach its net leverage maintenance covenant (after Q1-2026), especially under a downside scenario where production volumes would not increase. Another liquidity challenge will also be the turnaround in 2027 and a potential refinancing transaction. Moody's believes that the company needs to secure additional external sources of liquidity to fund those, as Moody's do not expect it to generate sufficient internal cash flow from operations. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade AnQore's rating if the company's adjusted debt to EBITDA is below 6x on a sustained basis; its liquidity profile improves; and FCF turns positive again. A positive rating action would also require more visibility on the refinancing of its debt maturities. Moody's could downgrade AnQore's rating if the company's liquidity continues to weaken or operating performance does not improve. A ratings downgrade could also be prompted if Moody's views on the probability of a restructuring or distressed exchange increases, or Moody's expectations on recovery in a default scenario, worsens. The principal methodology used in these ratings was Chemicals published in October 2023. The net effect of any adjustments applied to rating factor scores or scorecard outputs under the primary methodology(ies), if any, was not material to the ratings addressed in this announcement. COMPANY PROFILE Headquartered in the Netherlands, AnQore is a European producer of acrylonitrile (ACN) and other co-products. The company operates a 275kt ACN plant at the Chemelot site in Geleen (Netherlands) with two identical lines. The company is jointly owned by the private equity firm CVC Capital Partners (65%) and DSM-Firmenich AG (A3 stable) (35%). =========== R U S S I A =========== ARTEL ELECTRONICS: Fitch Affirms 'B' LT IDR, Alters Outlook to Neg. ------------------------------------------------------------------- Fitch Ratings has revised Artel Electronics LLC's (AE) Outlook to Negative from Stable. Fitch has also affirmed its Long-Term Issuer Default Rating (IDR) at 'B'. The Outlook revision reflects AE's weaker-than-expected revenues and higher working capital outflows. This has led to FCF deterioration and leverage above its rating sensitivity, which Fitch expects to continue in the short term. These factors restrict the company's financial flexibility and may increase liquidity pressure. The affirmation reflects its expectation of healthy profitability margins from lower cost inflation despite weaker revenue, which will support recovery in FCF and leverage. The IDR continues to reflect AE's small scale, limited geographical diversification, and exposure to intrinsic emerging-market and FX risks. Key Rating Drivers Weaker Domestic Revenues: Fitch expects Artel's revenue to decline further by 12% in 2025 from the level in 2024, due to stronger competition. Uzbekistan's accelerated accession to the World Trade Organization (WTO) is introducing reforms that facilitate easier market access for new international players. This results in its expectation for some of Artel's long-standing, key partners to sell directly to Uzbek customers, with material order volume decline for Artel, and intensified pricing competition. Fitch anticipates this trend will bottom-out in 2025, influenced also by the impact of subsiding cost inflation, before gradually recovering from 2026 onwards, when underlying demand dynamics become more favourable. Increased Leverage: AE's YE 2024 EBITDA leverage (3.3x) significantly exceeded its prior expectation (2.5x) due to the higher debt incurred to support working capital outflow on accelerated payables repayment and higher trade receivable days. While EBITDA also underperformed, Fitch expects a gradual improvement in leverage on higher EBITDA from 2026 towards the 3.0x negative rating sensitivity. The underperformance is mitigated by still relatively modest leverage compared to diversified manufacturing peers in this rating category and strong coverage ratios. Increase in Related-Party Guarantees: Artel noticeably increased its related-party guarantees as of March 2025 to broadly double from the level as of December 2023. Fitch does not include these guarantees in Artel's debt or leverage calculation as all underlying loans are secured by the borrowing parties' assets, Artel is not the sole or primary guarantor, and there is no indication of financial support from Artel to the borrowing parties historically or in the future. However, Fitch considers the increase a credit negative and would change its assessment of the guarantees if the related parties underperform. This would likely lead to a rating downgrade. FCF Generation to Improve: Fitch anticipates stronger FCF to support AE's liquidity, driven by higher EBITDA margin, lower capex on muted volumes, and normalized working capital outflow. Artel is shifting spending from its expansionary organic growth strategy in regional markets to relocation of domestic resources in more cost-effective local areas. Fitch expects working capital outflow normalization to be driven by better management of trade payable days, despite recent increases in trade receivable days and higher inventory days on lower sales volume. Fitch forecasts FCF margin to average 1%, despite dividends at a recently increased payout ratio and high interest expenses. Higher Profitability: Fitch expects AE to maintain its recently improved EBITDA margin due to declining cost inflation and a more favorable macroeconomic environment, despite high substitution risk and the low-cost nature of the industry. AE maintains its competitive edge over local peers on price and innovation. Geographic Concentration Constrains Rating: AE's small scale and limited export outreach remain a key rating limitation, despite increased efforts towards market diversification. AE has weaker geographic diversification relative to many of its diversified manufacturing peers, which typically operate across a broader regional footprint. In 2024, approximately 80% of AE's revenue was from the Uzbek market, while all of its non-current assets are in Uzbekistan. This increases the company's vulnerability to domestic systemic risks. Leading Market Position: AE is the leading household appliances producer in Uzbekistan, with a market share of over 50% in six of its nine revenue streams. Its strong market position, successful long-term co-operation with well-recognised brands such as Shivaki, its established production, and logistical network all act as barriers to entry, reinforcing its negotiating power. Peer Analysis AE is considerably smaller than its direct peers Arcelik A.S. (Local Currency (LC) IDR: BB-/Negative, Foreign Currency (FC) IDR: BB-/Negative) and Vestel Elektronik Sanayi Ve Ticaret A.S. (LC IDR: B-/Negative, FC IDR: B-/Negative). AE's limited geographic diversification, with 80% of sales derived from Uzbekistan, in comparison with Arcelik's 45% locally, is another contributing factor to the multi-notch difference in their ratings. Fitch views material exposure to emerging markets as a rating limitation for these peers as it makes cash flow generation susceptible to macroeconomic, political, and FX risks. AE's position as a low-cost manufacturer in Uzbekistan and other regional markets underpins its EBITDA and EBIT margin forecast of about 16% and 12%, respectively. These are similar to other diversified industrial companies such as Ahlstrom Holding 3 Oy (B+/Negative), ams-OSRAM AG (B/Stable), and Ammega Group B.V. (B-/Negative), but weaker than that of INNIO Group Holding GmbH (B+/Positive). AE's relatively weak FCF margins are similar to Ammega and ams-OSRAM, but weaker than Ahlstrom and Innio, driving the one-notch rating difference. AE's leverage is comparable to that of higher-rated peers, such as Arcelik and Innio, and is considerably lower than that of Ammega, Ahlstrom and ams-OSRAM. Key Assumptions - Revenue decline of about 12% in 2025 and average growth of about 3.5% per year during 2026-2028. - EBITDA margin of just above 16% during 2025-2028, supported by lower cost inflation. - Normalised working capital outflows. - Capex reduced to around 3% of sales over 2025-2028 on lower sales and production refocus. - Dividend payments of about UZS344 billion in 2025 and average UZS360 billion from 2025. - Regular refinancing of short-term debt. - No M&A until 2028. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - EBITDA leverage above 3x on a sustained basis; - FCF margin below 1%; - EBITDA margin below 11%; - Deterioration in liquidity, resulting in an inability to refinance short-term debt. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Sustainable and continuous track record of improved corporate governance, including greater financial transparency; - Improved geographical diversification, with a materially lower reliance on the domestic market; - FCF margin above 3% on a sustained basis; - EBITDA leverage below 2x on a sustained basis and improved liquidity. Liquidity and Debt Structure AE's liquidity is solely supported by cash, with no available committed credit facilities, and it does not cover its short-term debt obligations for 2025. Liquidity is further strained by an expected negative FCF in 2025 on higher interest payments, while Fitch expects lower working capital outflow dividend payments compared to 2024. This is mitigated by AE's supportive, long-term relationship with local banks enabling it to refinance its short-term debt regularly. The low cash balance reflects AE's business seasonality, with the strongest cash-generative months at year-end, and high capex and working-capital swings. AE's capital structure is concentrated with 88% of total debt raised from a single source. AE significantly increased guarantees provided to related parties. Issuer Profile AE is based in Uzbekistan (BB/Stable) and is a leading domestic producer of household appliances and electronics. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Artel Electronics LLC LT IDR B Affirmed B =========================== U N I T E D K I N G D O M =========================== 2TECH LIMITED: FRP Advisory Named as Administrators --------------------------------------------------- 2TECH Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-005152, and Jonathan James Beard and John Walters of Begbies Traynor (Central) LLP, were appointed as administrators on Aug. 11, 2025. 2TECH Limited specialized in wholesale and distribution. Its registered office is at Barttelot Court, Barttelot Road, Horsham, RH12 1DQ. The administrators can be reached at: Jonathan James Beard John Walters Begbies Traynor (Central) LLP 26 Stroudley Road, Brighton East Sussex BN1 4BH Any person who requires further information may contact: Naomi Cooper Begbies Traynor (Central) LLP E-mail: Naomi.Cooper@btguk.com Telephone: 01273 322960 BUCKINGHAM GROUP: BK Plus Limited Named as Administrator -------------------------------------------------------- Buckingham Group Contracting Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts in Birmingham Insolvency and Companies List (ChD), No No 000485 of 2023, and Richard Tonks of BK Plus Limited was appointed as administrator on July 25, 2025. Buckingham Group Contracting, fka Buckingham Plant Hire (Contracting) Limited, specialized in construction. Its principal trading address is at Blackpit Farm, Stowe, Buckingham, MK18 5LJ. The administrator can be reached at: Richard Tonks BK Plus Limited Azzurri House, Walsall Business Park Walsall Road, Walsall West Midlands, WS9 0RB For further information contact: Katie Wells BK Plus Limited Tel No: 01922 922050 Email: katie.wells@bkplus.co.uk CALON CARDIO: Stones & Co Insolvency Named as Administrators ------------------------------------------------------------ Calon Cardio-Technology Ltd was placed into administration proceedings in the High Court of Justice Business & Property Courts of England & Wales No CR-2025-005228, and Gareth Stones of Stones & Co Insolvency Practitioners Limited was appointed as administrator on Aug. 7, 2025. Calon Cardio-Technology specialized in creation of an innovative alternative to traditional heart implants for people in heart failure. Its registered office is at Unit 1b, Sandringham Park, Llansamlet, Swansea, SA6 8PW. The administrator can be reached at: Gareth Stones Stones & Co Insolvency Practitioners Limited 63 Walter Road Swansea, SA1 4PT Further details contact: Tina Leahy Telephone: 01792 654607 Email: info@stonesandco.co.uk CLAIRE'S ACCESSORIES: Interpath Ltd Named as Joint Administrators ----------------------------------------------------------------- Claire's Accessories UK Ltd Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies list (ChD) Court Number: CR-2025-005570, and William James Wright and Christopher Robert Pole of Interpath Ltd were appointed as joint administrators on Aug. 13, 2025. Claire's Accessories UK, trading as Claire's, specialized in the retail sale of new goods in specialized stores. Its registered office is at Interpath Ltd, 2nd Floor, 45 Church Street, Birmingham, B3 2RT. Its principal trading address is at Unit 4 Bromford Gate, Bromford Lane, Birmingham, West Midlands, B24 8DW. The joint administrators can be reached at: William James Wright Christopher Robert Pole Interpath Ltd 10 Fleet Place 2nd Floor, 45 Church Street Birmingham, B3 2RT For further details contact: Alex Ashley Tel. No.: 0203 839 7799 CLAIRE'S EUROPEAN SERVICES: Leonard Curtis Named as Administrators ------------------------------------------------------------------ Claire's European Services Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies list (ChD) Court Number: CR-2025-005571, and William James Wright and Christopher Robert Pole of Interpath Ltd, were appointed as joint administrators on Aug. 13, 2025. Claire's European Services specialized in business support services. Its registered office is at Interpath Ltd, 2nd Floor, 45 Church Street, Birmingham, B3 2RT. Its principal trading address is at Unit 4 Bromford Gate, Bromford Lane, Birmingham, West Midlands, B24 8DW. The joint administrators can be reached at: William James Wright Christopher Robert Pole Interpath Ltd 10 Fleet Place 2nd Floor, 45 Church Street Birmingham, B3 2RT For further details contact: Alex Ashley Tel. No.: 0203 839 7799 CLAIRE'S EUROPEAN: Interpath Ltd Named as Joint Administrators -------------------------------------------------------------- Claire's European Distribution Limited was placed into administration proceedings in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies list (ChD) Court Number: CR-2025-005572, and William James Wright and Christopher Robert Pole of Interpath Ltd, were appointed as joint administrators on Aug. 13, 2025. Claire's European provided non-specialised wholesale trade. Its registered office is at Interpath Ltd, 2nd Floor, 45 Church Street, Birmingham, B3 2RT. Its principal trading address is at Unit 4 Bromford Gate, Bromford Lane, Birmingham, West Midlands, B24 8DW. The joint administrators can be reached at: William James Wright Christopher Robert Pole Interpath Ltd, 10 Fleet Place 2nd Floor, 45 Church Street Birmingham, B3 2RT For further details contact: Alex Ashley Tel. No.: 0203 839 7799 DRINKS OF MANCHESTER: Clark Business Named as Joint Administrators ------------------------------------------------------------------ Drinks of Manchester Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts in Leeds Company and Insolvency List CHD No No 794 of 2025, and Phil Clark and Dave Clark of Clark Business Recovery Limited, were appointed as administrators on Aug. 13, 2025. Drinks of Manchester specialized in the distilling, rectifying and blending of spirits. Its registered office and principal trading address is at Arch, 10-15 Watson Street, Manchester, M3 4LP. The joint administrators can be reached at: Phil Clark Dave Clark Clark Business Recovery Limited 8 Fusion Court, Aberford Road Garforth, Leeds, LS25 2GH For further details contact David Hines Tel No: 0113 243 8617 Email: davidh@clarkbr.co.uk VERSARIEN GRAPHENE: Leonard Curtis Named as Joint Administrators ---------------------------------------------------------------- Versarien Graphene Limited was placed into administration proceedings in the High Court of Justice Business and Property Courts of England and Wales, Insolvency & Companies List (ChD) Court Number: CR-2025-005275, and Andrew Poxon and Andrew Knowles of Leonard Curtis, were appointed as joint administrators on Aug. 11, 2025. Its registered office is at Units 1a-D Longhope Business Park, Monmouth Road, Longhope, Gloucestershire GL17 0QZ. Its principal trading address is at Unit 1a, d, Business Park, Longhope GL17 0QZ. The joint administrators can be reached at: Andrew Knowles Andrew Poxon Leonard Curtis Riverside House, Irwell Street Manchester, M3 5EN Further details contact: The Joint Administrators Tel No: 0161 831 9999 Email: recovery@leonardcurtis.co.uk Alternative contact: Avery Lewis ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Europe is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2025. All rights reserved. ISSN 1529-2754. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. 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