S&P revises Israel Aerospace to stable

S&P said it revised the outlook on Israel Aerospace Industries Ltd. to stable from negative and affirmed its long- and short-term corporate credit ratings at BBB-/A-3.

S&P said the outlook revision reflects the progress Israel Aerospace has made in the execution of the reorganization plan it signed in August 2016 and the recent agreement of two mega contracts with a total value of more than $2.2 billion.

Under the agency’s updated base-case scenario, it projects S&P-adjusted EBITDA of $270 million-$300 million in 2017, which will enable the company to build some headroom under for the rating, allowing it to better cope with the intense competition in the industry.

That said, some of the execution risks associated with the reorganization changes still lie ahead, S&P added.

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