S&P changes Babilou outlook to stable

S&P said it changed its outlook for Babilou Family SAS to stable from positive and affirmed the B- ratings on the issuer and its €797 million term loan.

“Babilou demonstrated sound operating performance in 2023, although slightly below our base-case expectations on lower occupancy trend. We expect consolidated revenue will reach €860 million in 2023 reflecting year-on-year growth of around 10% compared with 2022, driven by positive pricing dynamics in all geographies and expansion of the network through greenfield and tuck-in mergers and acquisitions (M&A).

“That said revenue was slightly below our previous expectations because of lower occupancy due to staff shortages in Germany and the Netherlands, a slower ramp-up of centers acquired in Luxembourg, and a slower start of the academic year (September) in France,” the agency said in a press release.

S&P said it projects Babilou will focus on its greenfield strategy for growth, which should lead to a lift in revenue of about 5% to about €900 million in 2024.

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