S&P lifts Road Management bonds

S&P said it raised the issue rating on the £165 million fixed-rate bonds due 2021 issued by Road Management Consolidated plc to BB- from B+.

The agency said it placed the rating on CreditWatch with positive implications.

The recovery rating is 1+, indicating an expectation of full recovery of outstanding principal in case of default.

The upgrades reflect a view of increased likelihood of full senior debt repayment in light of the increasing levels of liquidity available to senior lenders, S&P said.

The total amount of cash and cash equivalents increased to about 81% of the £95.8 million of senior debt outstanding as of Nov. 30, the agency said, even though traffic growth in 2017 to date has been lower than expected.

The project's revenues are derived from traffic volumes via a shadow toll mechanism, the agency explained.

S&P said it previously projected traffic volumes would grow by 1.5% in 2017, but in the nine months that ended Sept. 30, year-on-year traffic volumes rose only 1.2%.

It is not yet clear why growth has been so lackluster, as the previous three years have seen strong growth at more than 3%, outpacing the United Kingdom's economic performance indicators for the period, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.