Research Update: Bombardier Recreational Products Inc. Upgraded To ?BB? From ?BB-? On Lower Leverage Expectation; Outlook Stable

Valcourt, Que.-based recreational vehicle manufacturer Bombardier Recreational Products Inc. (BRP) expects to witness strong demand for its products through fiscal 2023. We anticipate the company will experience robust topline and EBITDA growth over the next 12-24 months, supporting our view of an improved gross debt-to-EBITDA ratio (S&P Global Ratings' adjusted) of about 2.0x compared with our previous forecasts of about 2.5x. Therefore, on April 23, 2021, S&P Global Ratings raised its long-term issuer credit rating on BRP to 'BB' from 'BB-'. At the same time, we raised our issue-level rating on the company's asset-backed loan (ABL) to 'BBB-' from 'BB+' and our issue-level rating on BRP's senior secured debt (term loan B) to 'BB' from 'BB-'. The recovery ratings on

...- Valcourt, Que.-based recreational vehicle manufacturer Bombardier Recreational Products Inc. (BRP) expects to witness strong demand for its products through fiscal 2023. - We anticipate the company will experience robust topline and EBITDA growth over the next 12-24 months, supporting our view of an improved gross debt-to-EBITDA ratio (S&P Global Ratings' adjusted) of about 2.0x compared with our previous forecasts of about 2.5x. - Therefore, on April 23, 2021, S&P Global Ratings raised its long-term issuer credit rating on BRP to '##' from '##-'. - At the same time, we raised our issue-level rating on the company's asset-backed loan (ABL) to '###-' from '##+' and our issue-level rating on BRP's senior secured debt (term loan B) to '##' from '##-'. The recovery ratings on the ABL and term loan are unchanged at '1' and '4', respectively. - The stable outlook reflects our view that strong demand for BRP's products, along with low dealer inventory levels, will lead to sustained EBITDA generation...

Research Update