Sectors > Top Reports > ASDA Memo 060122

ASDA Memo 060122

ASDA. How Resilient Are ASDA’s EV, FCF, Leverage & Liquidity To Revenue Loss To Aldi From Its Planned New Store Openings? Store-By-Store Analysis
PUBLISHED: 06 January 2022
PAGES: 129
SUBMARKET: ASDA, Top Reports, Top Reports,


Why Read?

  • Understand how resilient ASDA’s EV, FCF, leverage and liquidity are to potential revenue loss: (1) to Aldi as Aldi executes on its planned store openings to 2025; and (2) to normalisation of COVID-induced food stock-piling 
  • Understand how well covered ASDA’s Senior Secured Notes (SSNs) and Senior Notes (SNs) are across our base and bear cases

What’s New?

  • Catchment area analysis of extent of competition ASDA may face from each of Aldi’s planned new store openings to 2025
  • Comparison of ASDA’s KPIs vs other UK food retailers (including Morrison which we expect to refinance its acquisition bridge facilities in 2022, following its LBO) – sales and EBITDA densities, store estates, rent levels, margins, cash generation
  • Financial projections, DCF valuation and sensitivities, across base and bear cases

Questions Answered

  • Has ASDA already absorbed, over FY 14- FY 16, most of the competitive impact from Aldi’s rise or is ASDA still particularly at risk of further market share loss to Aldi from the latter’s plans to open a further c. 300 stores by 2025?

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