S&P downgrades Isolux, notes to B-

Standard & Poor's said it lowered its long-term corporate credit rating on Isolux Corsan SA to B- from B.

The outlook is negative.

At the same time, the agency affirmed its B short-term corporate credit rating on the company.

In addition, S&P lowered its issue rating on the company's €850 million senior unsecured notes to B- from B. The recovery rating is unchanged at 4, indicating an expectation of average recovery in the higher half of the 30%-50% range in the event of a payment default.

The downgrade reflects S&P’s view that Isolux will exhibit weak liquidity over its 12-month rating horizon.

In the agency’s view, Isolux's weak operational cash flows continue to come under heavy pressure from a high cash interest burden. This results in very little cash available to repay short-term debt maturities and also to fund capital expenditure (capex) and potentially sizable working capital swings.

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