S&P places American Airlines on watch

S&P said the steep decline in airline bookings due to the coronavirus pandemic will lead to weaker credit metrics and cash flow for American Airlines Group Inc. The agency placed its ratings American Airlines Group Inc. and its subsidiary American Airlines Inc. on CreditWatch with negative implications.

“We now expect funds from operations (FFO) to debt to decline to the high-single-digit percent area in 2020, compared with our previous expectation of the high-teens-percent area, assuming passenger traffic begins to recover later this year,” said S&P in a press release.

S&P said it expects to resolve the CreditWatch when it has more information regarding the degree and timing of the return of passenger travel.

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