S&P boosts Samsonite International

S&P said it raised its ratings on Samsonite International SA and its senior unsecured debt to BB from BB-. The agency also upgraded Samsonite’s secured debt rating to BB+ from BB.

“The upgrade reflects our expectation that increasing demand for travel will drive continued sales momentum and deleveraging this year. Samsonite reported net sales growth of 52% in fiscal 2022 on a constant currency basis relative to 2021, along with good profit generation owing to its expense-reduction initiatives. The sales growth relative to the prior year reflects rebounding global demand for leisure travel.

“Still, sales remained 10% below pre-pandemic levels on a constant currency basis (excluding Russia and Speck), partially due to restrictions during the year in some parts of the world, primarily in China, that we believe stifled demand for travel-related merchandise. These restrictions have since been lifted, and we anticipate pent-up travel demand in China will drive sales growth towards pre-pandemic levels because China is one of Samsonite's largest markets, accounting for approximately 8% of consolidated net sales pre-pandemic,” S&P said in a press release.

The outlook is stable.

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