S&P raises Grupo Posadas

S&P said it raised its rating on Grupo Posadas SAB de CV to B- from D and withdrew the D rating on the senior unsecured notes due 2022 that were exchanged for new notes due 2027.

The upgrade follows the group completing its prepackaged Chapter 11 restructuring the agency said.

“We expect the company's operating and financial performance to continue recovering gradually in the next 12 months, while the new capital structure provides greater financial flexibility to face the pandemic-induced downturn in the global hospitality industry,” S&P said in a press release.

The outlook is stable. The agency said it forecasts the company to post high single-digit revenue growth and its profitability to recover in the next 12 months, while keeping tight cost controls and protecting its cash balance. “As a result, we estimate its gross debt to EBITDA to be near 9x and EBITDA interest coverage of about 2x by the end of 2022, considering the new capital structure.”

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