Fitch changes Latam Airlines view

Fitch Ratings said it affirmed Latam Airlines Group SA's long-term foreign currency issuer default rating at B+.

In addition, Fitch affirmed TAM SA's foreign and local currency IDRs at B+ and affirmed Latam’s unsecured notes at B+/RR4.

The outlook was revised to positive from stable.

“The action encompasses Latam's 2017 financial performance–in line with expectations previously incorporated in the ratings–including improved operational margin at 7%, $732 million in positive free cash flow generation, important debt reductions, lower financial leverage and consistently high liquidity,” the agency said in a news release.

Fitch said the positive outlook is supported by expectations that the improvement in the company's credit metrics will continue during 2018, reaching an EBIT margin of around 8%, adjusted gross leverage trending to 4.5 times and liquidity, measured as cash and unused committed credit lines/latest 12 months revenues ratio, remaining around 20%.

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