Air Canada 2014 Annual Report Download - page 55
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55
2014 Management’s Discussion and Analysis
Ratings
Air Canada’s corporate credit and/or
Air Canada’s Senior Notes are rated by the
following rating agencies:
• Moody’s Investors Service, Inc. (“Moody’s”)
• Standard & Poor’s Ratings Services (“Standard &
Poor’s”)
• Fitch Ratings, Inc. (“Fitch”)
• DBRS Limited (“DBRS”)
Moody’s Ratings
On September 17, 2014, Moody’s upgraded the
following ratings relating to Air Canada:
• Air Canada’s corporate family rating to B2
from B3 and probability of default ratings to
B2-PD from B3-PD
• Senior First Lien Notes rating to Ba3 from B1 and
Senior Second Lien Notes rating to B3 from Caa1
• Senior Unsecured Notes rating to Caa1 from Caa2
• Air Canada’s speculative grade liquidity rating was
affirmed at SGL-2
• The ratings on Air Canada’s 2013-1 Class A, Class B
and Class C Enhanced Equipment Trust Certificates
(“EETCs”) were upgraded by one notch to Baa1,
Ba2, and B1, respectively
• The rating outlooks for Air Canada and the EETCs
were changed to stable from positive
Standard & Poor’s Ratings
On February 2, 2015, Standard & Poor’s upgraded the
following ratings relating to Air Canada:
• Air Canada’s corporate credit rating to B+ from B,
stable trend
• Senior Unsecured Notes rating to B from B-.
- No change to the recovery rating: Senior
Unsecured Notes rating of 5
• Senior First Lien Notes rating to BB from BB- and
Senior Second Lien Notes rating to BB from B-.
- No change to the recovery rating: Senior
First Lien Notes rating of 1
- Senior Second Lien Notes rating revised to
1 from 5
• The rating on Air Canada’s 2013-1 Class A
enhanced equipment trust certificate (“EETC”) was
reaffirmed at A and the ratings on Air Canada’s
2013-1 Class B and Class C EETCs were raised by
one notch each to BBB- from BB+ and to BB- from
B+, respectively
Fitch Ratings
On April 8, 2014, Fitch undertook the following
actions relating to Air Canada:
• Fitch affirmed the following ratings:
- Air Canada’s long-term issuer default rating
(IDR) of B
- Senior First Lien Notes rating of BB with a
recovery rating of RR1
- Air Canada’s 2013-1 Class A,
Class B and Class C EETCs of A, BB+ and
BB-, respectively
• Fitch upgraded the following ratings:
- Senior Second Lien Notes rating to BB with
a recovery rating of RR1 from BB- with a
recovery rating of RR2
• Fitch assigned the following rating:
- Senior Unsecured Notes rating of B- with a
recovery rating of RR5 (EXP)
DBRS Ratings
On November 11, 2014, DBRS reaffirmed Air Canada’s
Issuer Rating of “B”, and changed the trend to positive
from stable.
Ratings are intended to provide investors with an
independent view of credit quality. They are not a
recommendation to buy, sell or hold securities and
may be subject to revision or withdrawal at any time
by the rating organization. Each rating should be
evaluated independently of any other rating.