Moody's slices Global Medical

Moody's Investors Service said it downgraded Global Medical Response, Inc.'s ratings, including the ratings of the company's senior secured first-lien term loan, term loan, and notes to Caa2 from B3.

“The ratings downgrade reflects a further deterioration in operating performance as a result of persistent inflationary cost pressures and two separate fatal aviation accidents that have negatively impacted the company's earnings. Moody's expects that inflationary cost pressures, most notably from increased wages directed at attracting and retaining human capital, specifically with pilots, will continue and result in elevated operational expenses. Moody's calculates GMR's pro forma debt to EBITDA in the low 10 times range at March 31, 2023,” the agency said in a press release.

Moody's said it forecasts GMR’s leverage to remain elevated above eight times over the next 12 to 18 months, despite the company's cost-saving initiatives program.

The outlook remains negative.

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