S&P raises Airxcel

S&P said it raised Airxcel Inc.’s issuer and first-lien debt ratings to B from B- and its second-lien debt rating to CCC+ from CCC.

“The upgrade reflects robust retail demand for RVs, which will likely enable the company to sustain adjusted debt to EBITDA under 6.5x. The perception that RVs are a safe travel option during the Covid-19 pandemic will likely support continued robust revenue and EBITDA generation at Airxcel in 2021 and probably for a good portion of 2022,” the agency said in a press release.

S&P said it forecasts that total lease-adjusted debt to EBITDA could reach the 4.5x-5x range in 2021, driven by higher sales volumes and EBITDA margin expansion, before demand normalizes and leverage returns to the 5x-5.5x range in 2022.

The outlook is stable.

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