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Moody's Affirms IAG Credit Rating At Baa3 With Stable Outlook.

LONDON (Alliance News) - Moody's Investors Service late Friday affirmed International Consolidated Airlines Group SA's Baa3 long-term issuer rating, keeping the outlook stable.

The credit ratings agency also affirmed British Airways PLC at Baa3, while raising the IAG division's outlook to positive from stable.

"IAG's Baa3 rating reflects its highly diverse and extensive global route network with strong market positions. The company's integrated operating model combined with its conservative financial policy, underpin the company's strong credit metrics, which are consistent with an investment grade rating," commented Martin Hallmark, a Moody's senior vice president and lead analyst for IAG.

Moody's said it raised the outlook for British Airways due to its "strong operating performance and credit metric improvement in 2018", which it said is "underpinned by its strong brand and market positions".

"There are growing industry headwinds in Europe, which could negatively pressure IAG's future earnings and cash flow, but Moody's believes IAG has sufficient operational and financial flexibility to weather a modest downturn," Hallmark said.

Moody's cited weaker pricing due to market overcapacity in Europe, higher fuel costs, and the risk of flight disruption due to air traffic control issues. The last of these affects British Airways less than its European peers, the ratings agency noted.

IAG also owns Aer Lingus in Ireland and Iberia and Vueling in Spain.

By Tom Waite;

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Publication:Alliance Newswire
Date:May 25, 2019
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