Risks intensify for debt-ridden Ezra on back of unabated oil price bloodbath

It has $645m worth of debt due this year.

Highly-leveraged Ezra is struggling through extremely choppy waters the oil rout continues. The mainboard-listed offshore player has the highest amount of outstanding debt in CIMB’s coverage, and the firm has to maneuver fast to keep sharks from the hatch.

According to CIMB, Ezra has outstanding $645m (US$482m) bank borrowings and debt securities due in 2015 versus a measly $232.8m (US$174m) in cash.

Of the $645m (US$428m), $360 (US$269m) relates to the $200m 5% 3-year note due in 2015 and $150m 8.75% perpetual securities callable on 2015.

“We expect the company to refinance the notes through the bond market, albeit with higher financing costs. The possibility of a cash call in the medium term is also not ruled out. Additionally, with delivery of the US$650m Lewek Constellation and moderation in capex, we expect the group to deleverage,” stated CIMB.