Fitch places Spirit Airlines on watch

Fitch Ratings said it placed Spirit Airlines on rating watch negative. The negative rating watch is based on the sharp drop in demand occurring in the market due to the coronavirus. U.S. airlines are reporting steep and broad-based declines in passenger numbers since the virus began to appear widely outside of China.

The rating watch negative reflects Fitch's view that the effect on profitability from a prolonged coronavirus outbreak would push Spirit's leverage metrics outside of levels that support the BB rating.

The rating watch will be resolved Fitch said as it evaluates the evolution of the outbreak and evaluates whether Spirit's solid liquidity balance and low-cost structure allow it to return to credit metrics consistent with the BB rating by the end of 2021 or 2022.

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