S&P trims GHD

S&P said it lowered its ratings for GHD Verwaltung GesundHeits GmbH Deutschland and its term loan and revolver to CCC+ from B-. The 4 recovery rating (45%) on the term loan is unchanged.

“The rating action reflects our view that GHD's operations are still suffering from pandemic-induced disruptions and a structural shortage of medical personnel. GHD's operations in home care are still pressured by disruptions in the healthcare market in the aftermath of Covid-19. Given the high rate of infection of medical staff caused by the omicron variant, we continue observing a delay in recovery of plannable surgeries.

“In addition, we observe that access to nursing homes and hospitals is still somewhat constrained, affecting the company's patient base after it was hit by high death rates linked to the pandemic,” S&P said in a press release.

The agency said it estimates low single-digit revenue growth and EBITDA margins narrowing to 4.5%-5.5%, pushing S&P Global Ratings-adjusted debt to EBITDA considerably above 20x (or above 10x excluding the shareholder loan).

The outlook is stable.

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