Why Read?

• Douglas Senior Notes gained c. 19pp (c. 25%) in just 7 trading sessions since our Buy recommendation (and further gains on the TLB where we also had a Buy recommendation). Understand our updated thinking on current value post Q1 20 results across the capital structure, particularly given differences in guarantor EBITDA coverage and security for the SSNs vs TLB
• Our bull and bear case profitability drivers for Douglas, referencing our large scale machine learning findings on: (a) the magnitude of potential downward product price and gross margin pressure for Douglas outside of Germany going forward as online competition proliferates; and  (b) the scope for Douglas to close further stores based on geographic overlaps and income-weighted population density
• Our updated FCF forecasts and valuation 
• Working capital (WC) analysis and what Q1 20 WC cash flow might mean for WC cash flow for the remainder of the year
• Q1 20 results analysis and comparison to our expectations