20th Mar 2020 06:13
(Alliance News) - Moody's Investors Service on Thursday damped its outlook on Informa PLC but has not yet changed ratings.
Moody's has affirmed its Baa3 issuer and senior unsecured credit ratings for the FTSE 100 events and publishing firm. The rating has been altered to negative from stable.
The change to a negative outlook reflects pressure building on revenue and earnings in 2020 due to the delay and cancellation of events prompted by Covid-19, Moody's said.
Informa warned earlier March no financial guidance would be given for 2020. As at that time, well over 100 events had been rescheduled or cancelled. Moody's said Informa has so far traded GBP250 million of its GBP1.9 billion annual revenue from events.
Shows worth GBP400 million of revenue have been pushed into the second half of 2020 and 13 shows have either been cancelled or put into 2021, covering GBP25 million of revenue.
"If the coronavirus related disruptions end in the first half of 2020, then Informa's performance may not be as adversely affected. However, should the disruptions continue in the second half of the year, the company's credit metrics could get materially worse," said Gunjan Dixit, a Moody's vice president and lead analyst on Informa.
"With Moody's adjusted gross debt to earnings before interest, tax, depreciation, and amortiation of 2.8 times at the end of 2019, Informa has limited headroom within the Baa3 rating for any material under-performance. We are nevertheless comforted by the company's liquidity position and recognise the events business could recover rapidly in 2021 in the instance coronavirus related disruptions are not long-lived."
By George Collard; [email protected]
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