DBRS upgrades Elis

DBRS said it upgraded Elis SA’s issuer rating and senior unsecured notes rating to BBB from BBB (low) and changed the trends to stable from positive.

“The upgrades reflect prolonged improvements in Elis' operating performance that, along with a sound financial policy, led to improved financial metrics that are currently commensurate with a BBB rating, the agency said in a press release.

However, “On the other hand, the credit ratings are constrained by the concentration in a few geographic areas, such as France, the U.K. & Ireland, and Central European countries, which together accounted for more than two-thirds of 2023 revenue. In addition, Elis has limited opportunities to rapidly expand and increase its market shares in key geographies, as the sector that it operates in is highly fragmented and market competition regulations might prevent the acquisitions of larger competitors,” the agency said.

DBRS said it expects Elis to continue maintaining a leverage ratio (gross debt-to-EBITDA) between 2x and 2.5x over the next one to four years, which is reflected in the stable trend.

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