Research Update: Samsonite International S.A. Downgraded To 'B' From 'BB-' Due To Weaker-Than-Expected Recovery; Outlook Negative

Luxembourg-based Samsonite International S.A.'s operating performance continues to suffer from travel restrictions and limited consumer mobility due to the COVID-19 pandemic. We expect EBITDA stabilization will take longer than previously expected stemming from sustained weakness in the travel and leisure industry. As a result of our expectation that profitability and cash flow will not recover significantly until at least fiscal 2022, we are lowering our issuer credit rating to 'B' from 'BB-'. Concurrently with the downgrade, we are also lowering our ratings on the company's senior secured debt to 'B+' from 'BB' and on the senior unsecured debt to 'B-' from 'B+'. The recovery ratings remain '2' and '5', respectively. The negative outlook reflects the risk that operating performance could

... operating performance continues to suffer from travel restrictions and limited consumer mobility due to the COVID-19 pandemic. We expect EBITDA stabilization will take longer than previously expected stemming from sustained weakness in the travel and leisure industry. - As a result of our expectation that profitability and cash flow will not recover significantly until at least fiscal 2022, we are lowering our issuer credit rating to 'B' from '##-'. - Concurrently with the downgrade, we are also lowering our ratings on the company's senior secured debt to 'B+' from '##' and on the senior unsecured debt to 'B-' from 'B+'. The recovery ratings remain '2' and '5', respectively. - The negative outlook reflects the risk that operating performance could deteriorate further resulting in a continuation of cash burn and negative EBITDA over the next 12 months....

Research Update