Research Update: Italian Rail And Road Group Ferrovie dello Stato Italiane 'BBB' Rating Affirmed Amid COVID-19-Related Traffic Decline

We expect passenger traffic revenue will drop by 35% in 2020 on the Italian network operated by Ferrovie dello Stato Italiane (FSI) as a result of a sharp sharp decline in passenger numbers and train services following the introduction of COVID-19-related mobility restrictions. We expect on-going subsidies from the regional and central government and postponement of capital expenditure will somewhat mitigate this drop, but forecast the group's funds from operations (FFO) to debt will nonetheless fall to 17%-18% from 22%-23%, which is still commensurate with its 'bbb+' stand-alone credit profile (SACP). We are therefore affirming our 'BBB' long-term issuer credit rating on FSI, in line with our sovereign rating on Italy, and our 'BBB' issue rating on FSI's unsecured debt.

...- We expect passenger traffic revenue will drop by 35% in 2020 on the Italian network operated by Ferrovie dello Stato Italiane (FSI) as a result of a sharp sharp decline in passenger numbers and train services following the introduction of COVID-19-related mobility restrictions. - We expect on-going subsidies from the regional and central government and postponement of capital expenditure will somewhat mitigate this drop, but forecast the group's funds from operations (FFO) to debt will nonetheless fall to 17%-18% from 22%-23%, which is still commensurate with its '###+' stand-alone credit profile (SACP). - We are therefore affirming our '###' long-term issuer credit rating on FSI, in line with our sovereign rating on Italy, and our '###' issue rating on FSI's unsecured debt. - The negative outlook mirrors that on Italy....

Research Update