S&P changes Elis outlook to positive

S&P said it changed its outlook for Elis SA to positive from stable and affirmed the BB+ ratings on the issuer and its senior unsecured notes. The 3 recovery rating on the notes remains 3.

“Elis' strong revenue growth in 2022 bolstered the company's deleveraging despite some margin pressure. The company reported organic growth of 21%, driven by strong recovery in the hospitality segment, where volumes are now back to pre-pandemic levels. Growth was also supported by new business wins, good client retention, and price increases of about 7%. Adding the contribution of recent acquisitions, total revenue growth was 25%,” S&P said in a press release.

The improved outlook reflects the potential for an upgrade in the next 12 months if Elis continues reporting sound organic growth and stabilizes or improves its EBITDA margin, leading to an S&P Global Ratings-adjusted debt to EBITDA under 3x and FFO to debt above 30% on a sustained basis, the agency said.

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