Moody’s upgrades Ashtead, notes

Moody's Investors Service said it upgraded the long-term issuer rating of Ashtead Group plc to Baa3 from Ba1.

The agency also upgraded to Baa3 from Ba2 the instrument ratings assigned to the second priority senior secured notes due 2024, 2025, 2026 and 2027 issued by Ashtead Capital, Inc.

The outlook is stable.

Moody's withdrew Ashtead's probability of default rating of Ba1-PD following the upgrade.

"Moody's decision to upgrade Ashtead to investment grade reflects the continued improvement in the company's credit profile since the agency upgraded the corporate family rating to Ba1 from Ba2 in November 2016,” Sebastien Cieniewski, Moody's lead analyst for Ashtead, said in a news release.

The key drivers behind the improved credit profile include the increased scale of the business, the expectation of continued revenue and earnings growth over at least the next 18 to 24 months supported by strong market dynamics in the United States and Canada, and the fact that the company has maintained net leverage within its target range of 1.5x to 2.0x despite significant investments to grow the fleet over the period and increasing shareholder distributions.

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