Fitch rates Spirit Airlines notes BB+

Fitch Ratings said it rated Spirit Airlines Inc.’s planned senior secured notes BB+/RR1. The agency also affirmed Spirit’s BB+/RR1 senior secured ratings but trimmed the issuer default rating to B+ from BB-.

“Fitch believes improvement of Spirit's credit metrics to levels that support a BB category rating will be prolonged beyond our prior expectations. Various headwinds including pilot constraints, aircraft delays, and general inflationary pressures contribute to our expectations that Spirit's operating margins will remain well below historical levels at least through 2023. Fitch estimates that total adjusted leverage will remain above our negative sensitivity of 4.75x through 2024,” the agency said in a press release.

Spirit plans to use the proceeds for general corporate purposes, including building additional liquidity ahead of a potentially volatile operating environment in 2023. “Fitch views the additional liquidity as prudent given current macroeconomic uncertainties,” the agency said.

The outlook is stable.

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