Monday 27 June 2016 by Trade opportunities

SCT Logistics now available to retail investors

Two of SCT Logistics’ bonds have seasoned and are now available to retail investors

The bonds – one fixed with a yield to maturity of 6.51% maturing June 2021, and one floating rate with a yield to maturity of 5.99% maturing June 2019 – are good considerations for clients wanting to lock in a high fixed or floating rate of return.

SCT Logistics (SCT) was established in 1974 by Mr Peter Smith, and is 100% owned by the Smith Family. SCT is a national, multi modal transport and logistics company, with its own truck, locomotive and rolling stock. Commencing as an East West operator, SCT now has operations throughout Australia providing long haul rail freight services and operating terminals and warehouses.

SCT operates an integrated intermodal business, offering the following:

  • Integrated rail freight forwarding and is the largest on the East West corridor, allowing direct access to customers and freight directed to the SCT rail operation
  • Approximately 40% market share, with access to modern terminals in key capital cities. SCT is the second largest rail freight operator on the East West corridor
  • Road line haul and short haul which complements the core rail operation and allows SCT to provide a full service offering to its customers
  • Warehousing with SCT operating warehouses in Perth, Brisbane and Sydney, allowing SCT to offer value adding services to its customers.

SCT has long term relationships with its customers, as evidenced by the top 20 customers having an average relationship with SCT of around 15 years.

Length of relationship (years)

The senior secured lenders receive payment in priority to these bonds only in the event of a winding up. All ongoing obligations for payment of interest and principal to the senior secured lenders and to the bondholders will be made so long as there is no event of default.

These bonds have a similar structure with bond issues in the global high yield market and may provide structural benefits for investors as compared to other products including the recent ASX listed corporate hybrid transactions.

Both SCT bonds trade separately on the secondary market, are not listed on a stock exchange, nor are rated by a ratings agency.

More information on SCT can be accessed via the research report.External link - opens in a new window

Please contact your FIIG representative for further details on the SCT Logistics fixed and floating rate bonds. Available to retail and wholesale investors only with a minimum face value of AUD10,000. Pricing is indicative and subject to change.