Why Read?

• Understand Lowell’s prospects of refinancing / Amend & Extend
• Understand possible strategies for sponsors to expropriate value from SSNs
• Understand SSNs recovery prospects across a range of scenarios including hypothetical administration and debt restructuring and business run-off scenarios
• Understand DCF and In-Force plus New Business valuations of Lowell
• Understand possible magnitude of downside risk to Lowell’s ERC should breakage rates increase and / or one-off settlements decrease relative to ERC modelling assumptions
• Understand Lowell’s back book all-in net IRRs (after collection activity costs and DP share of other opex) and what these imply for weighted average cost of debt needed for sustainable FCF
• Understand listed comparables and M&A transaction valuation multiples in credit management services sector and what these imply for Lowell’s valuation

What’s New?

• Scenario analysis for Lowell to address its debt maturity wall commencing in 2025
• DCF and In-Force plus New Business financial projections, valuation and sensitivities

Questions Answered

• How do Lowell’s refinancing prospects compare to when it last refinanced in Q4 20?
• How have Lowell’s back book all-in net IRRs trended over time and what weighted average cost of debt can it afford to pay in any refinancing?
• How much possible downside risk is there to Lowell’s ERC and what mitigants are there to this?
• What impact have ABS issuance and disclosed portfolio sales since Q3 22 had on Lowell’s financials?