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AAR Corp. Rating Lowered To 'BB' On Longer Expected Impact From Coronavirus Pandemic; Outlook Negative

Published May 28, 2020

3 pages (1678 words) — Published May 28, 2020

Price US$ 150.00 | Buy this Report Now

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Abstract:

We now believe the impact on AAR Corp.'s earnings and cash flow due to lower air travel from the coronavirus pandemic will be more severe and last longer than we expected. Therefore, we are lowering our issuer credit rating on the company to 'BB' from 'BB+'. The negative outlook reflects further risk to the business if demand is significantly worse than expected, AAR cannot cut costs, or has difficulty generating positive free cash flow. NEW YORK (S&P Global Ratings) May 28, 2020—S&P Global Ratings today took the rating actions above. Health and safety The negative outlook on AAR reflects further risk to earnings and cash flow as a result of the coronavirus pandemic. We now expect credit metrics to be

Brief Excerpt:

...May 28, 2020 - We now believe the impact on AAR Corp.'s earnings and cash flow due to lower air travel from the coronavirus pandemic will be more severe and last longer than we expected. - Therefore, we are lowering our issuer credit rating on the company to '##' from '##+'. - The negative outlook reflects further risk to the business if demand is significantly worse than expected, AAR cannot cut costs, or has difficulty generating positive free cash flow. NEW YORK (S&P Global Ratings) May 28, 2020--S&P Global Ratings today took the rating actions above. AAR's earnings will likely weaken significantly in fiscal 2021 (ending May 31, 2021) because of the coronavirus pandemic and will likely take longer to recover. The International Air Transport Association expects global air travel to be down 50% in 2020 and take at least until 2022 or 2023 to return to 2019 levels. This will result in significant loss of demand for AAR's aftermarket parts and maintenance, repair, and overhaul businesses...

Report Type:

Ratings Action

Ticker

AIR

Issuer

AAR Corp.

GICS

Aerospace & Defense (20101010)

Sector

Global Issuers

Country

United States

Region

United States

Format:

PDF

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Research Update: AAR Corp. Outlook Revised To Stable From Negative On Improved Margin And Good Cash Flow Generation, 'BB' ICR Affirmed – 2021/02/16 – US$ 225.00

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AAR Corp. – 2023/02/13 – US$ 500.00

Research Update: AAR Corp. Rating Lowered To 'BB' On Longer Expected Impact From Coronavirus Pandemic; Outlook Negative – 2020/05/28 – US$ 225.00

AAR Corp. ICR Affirmed On Credit Metric Cushion Despite Likely Decline In Demand Due To The Coronavirus, Outlook Stable – 2020/04/09 – US$ 150.00

Research Update: AAR Corp. ICR Affirmed On Credit Metric Cushion Despite Likely Decline In Demand Due To The Coronavirus, Outlook Stable – 2020/04/09 – US$ 225.00

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Summary: AAR Corp. – 2019/02/22 – US$ 225.00

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Cite this Report


MLA:	S&P Global Ratings’ Credit Research. "AAR Corp. Rating Lowered To 'BB' On Longer Expected Impact From Coronavirus Pandemic; Outlook Negative" May 28, 2020. Alacra Store. Nov 07, 2026. <http://www.alacrastore.com/s-and-p-credit-research/AAR-Corp-Rating-Lowered-To-BB-On-Longer-Expected-Impact-From-Coronavirus-Pandemic-Outlook-Negative-2450256>

APA:	S&P Global Ratings’ Credit Research. (). AAR Corp. Rating Lowered To 'BB' On Longer Expected Impact From Coronavirus Pandemic; Outlook Negative May 28, 2020. New York, NY: Alacra Store. Retrieved Nov 07, 2026 from <http://www.alacrastore.com/s-and-p-credit-research/AAR-Corp-Rating-Lowered-To-BB-On-Longer-Expected-Impact-From-Coronavirus-Pandemic-Outlook-Negative-2450256>

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