S&P shifts Movida view to positive

S&P said it shifted Movida Participacoes SA’s outlook to positive from stable and affirmed its BB- and brAA+ national scale issuer ratings.

“Movida has expanded its market share in the past year through a broader presence and diversification of end markets and clients, and increasing the size of its fleet close to 170,000 vehicles as of September 2021 from 108,000 as of September 2020. In addition, after the incorporation of CS Frotas in July and other smaller acquisitions, the fleet management's share of total revenue rose to 55% this year from the historical level of 35%-40%,” S&P said in a press release.

The outlook indicates a one-in-three chance of an upgrade in the next 12-18 months if Movida’s growth doesn't strain credit metrics, resulting in funds from operations to debt above 20% and EBIT interest coverage close to 2x on the average of the next three years, the agency said.

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