Moody's downgrades NCL

Moody's Investors Service said it downgraded the ratings of NCL Corp. Ltd., including its corporate family rating to B2 from Ba2, probability of default rating to B2-PD from Ba2-PD, senior secured rating to B1 from Ba2, and senior unsecured rating to Caa1 from B1.

NCL’s speculative grade liquidity rating was upgraded to SGL-2 from SGL-3. The outlook is negative. These actions end the review for downgrade started on July 14, the agency said.

"The downgrade reflects Moody's expectation that NCL's metrics will remain weak over at least the next two years with debt/EBITDA of above 7x and EBITA/interest expense below 2.5x," said Pete Trombetta, a Moody's lodging and cruise analyst, in a press release.

“The upgrade in NCL's speculative grade liquidity rating to SGL-2 reflects the steps the company has taken to enhance its cash balances which now stand at about $3.1 billion (pro forma for transactions subsequent to June 30), which provide it sufficient runway to get through this period of unprecedented earnings pressure,” Moody’s said.

The negative outlook mirrors NCL’s high leverage and uncertainty over demand for cruises that will enable it to lower its leverage, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.