18th Jan 2021 18:19
(Alliance News) - Moody's Investors Service on Friday has affirmed the corporate family rating of the Anglo-German tourism company TUI AG at Caa1, its senior unsecured rating at Caa1 and the probability of default rating at Caa1-PD.
The outlook has been changed to stable from negative, the ratings agency said.
"Our decision to stabilise TUI's rating outlook reflects the sizeable liquidity injection provided by three support packages with a total amount of 4.8 billion. This has largely covered an exceptionally high cash burn in fiscal 2020 and provides a significant buffer for potential further cash consumptions in a still highly challenging market environment," said Vitali Morgovski, a Moody's Assistant vice president-analyst.
The stable outlook reflects the expectation of continued external support in case of the absence of a material recovery of the operating performance, Moody's said, as the coronavirus spreading and travel activity remains highly uncertain in the short term.
Moody's, however, noted the potential for a medium term recovery of the underlying operating performance and hence further positive rating pressure, in case that the coronavirus outbreak is contained and travel activity resumes to historical levels.
TUI shares closed 1.4% lower in London on Monday at 397.56 pence each.
By Evelina Grecenko; [email protected]
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