New Zealand-based telecommunications company Spark New Zealand Ltd.'s adoption of NZ IFRS 16, effective Jan. 1, 2019, increased the company's adjusted leverage to about 1.58x in fiscal 2019, from about 1.41x if the effect of the revised lease accounting standard is excluded. As a result, the adjusted leverage is above S&P Global Ratings' previous downgrade threshold of 1.5x. However, this increase does not change our view of the company's underlying creditworthiness. Consequently, we have revised our downgrade rating trigger for the company to a debt-to-EBITDA ratio of 1.7x from 1.5x. On May 15, 2020, S&P Global Ratings affirmed its 'A-' long-term and 'A-2' short-term issuer credit ratings on Spark. We also affirmed the issue credit ratings on the company's debt.
