Moody’s ups IEA Energy Services

Moody’s Investors Service said it upgraded IEA Energy Services, LLC’s corporate family rating to B3 from Caa2, probability of default rating to Caa1-PD from Caa2-PD and senior secured first-lien bank credit facilities ratings to B2 from Caa2.

The upgrade comes after Moody’s finished the review it started in August.

“The upgrades reflect the improvement in IEA’s credit metrics and liquidity as a result of $180 million new equity raise during 2019 and the subsequent debt reduction. The upgrades also reflect Moody’s forecasts for IEA to further reduce debt/EBITDA to 5.0x by the end of 2019 given the expectation for significant growth in IEA’s EBITDA in Q4 2019 as the company continues to recover from the earnings impact of significant weather conditions in late 2018. Lastly, the upgrades reflect that IEA’s significantly reduced debt levels will allow it to maintain debt/EBITDA below 5.0x beyond 2020 despite the expectation for an adjustment in demand following the expiration of tax credits,” said Moody’s in a press release.

The outlook is stable.

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