Research Update: Mexican Airline Grupo Aeromexico Downgraded To 'B-' And Off Watch On Weakening Metrics And Liquidity, Outlook Negative

Mexico-based air transportation and cargo service provider, Grupo Aeroméxico, S.A.B. de C.V. maintains a well-diversified route portfolio, connecting Mexico with the U.S. and Canada, as well as some countries in Latin America, the Caribbean, Europe, and Asia. It currently operates at 10% of passenger traffic compared to 2019 under currently difficult economic conditions. As of April 30, 2020, total passengers serviced between domestic and international flights decreased 36% to 4.3 million from 6.8 million in 2019. Given the pandemic-induced economic crisis, Aeroméxico will face a sharp decline in passenger traffic in 2020 and 2021. As a result, we expect the company's EBITDA to plummet, while potential recovery will imply additional debt funding to compensate for liquidity shortfalls. We expect this

...- Mexico-based air transportation and cargo service provider, Grupo AeromTxico, S.A.B. de C.V. maintains a well-diversified route portfolio, connecting Mexico with the U.S. and Canada, as well as some countries in Latin America, the Caribbean, Europe, and Asia. It currently operates at 10% of passenger traffic compared to 2019 under currently difficult economic conditions. As of April 30, 2020, total passengers serviced between domestic and international flights decreased 36% to 4.3 million from 6.8 million in 2019. - Given the pandemic-induced economic crisis, AeromTxico will face a sharp decline in passenger traffic in 2020 and 2021. As a result, we expect the company's EBITDA to plummet, while potential recovery will imply additional debt funding to compensate for liquidity shortfalls. We expect this to be partially offset by some of AeromTxico's ongoing strategies to reduce fixed costs. - On May 21, 2020, S&P Global Ratings lowered its issuer credit and issue-level ratings on AeromTxico...

Research Update