TRIUMPH credit ratings upgraded by Moody’s, S&P

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Credit ratings recently improved for publicly traded Triumph Group Inc., the Radnor, Pa.-headquartered company that designs, develops, manufactures, repairs, and provides spare aerospace and defense parts to the global aviation industry.

“TRIUMPH took important strategic actions over the last year to create a more streamlined, value-added and IP-based business with a much stronger balance sheet,” said Jim McCabe, TRIUMPH’s senior vice president and chief financial officer. 

“These upgrades recognize our commitment to increasing shareholder value through the cycle of deleveraging benefits, supporting our multi-year targets for debt reduction, EBITDAP margin expansion, and free cash flow generation,” McCabe added.

Both Moody’s Ratings and S&P Global Ratings upgraded Triumph’s credit ratings, with both credit agencies rating TRIUMPH with a stable outlook.

Specifically, Moody’s on June 28 upgraded TRIUMPH’s corporate family rating to B3 from Caa1, citing materially reduced leverage from paying off the 2025 notes in their entirety, as well as a portion of the 2028 notes. 

Earlier, S&P on June 6 upgraded TRIUMPH’s issuer credit rating to B- from CCC+, citing the company’s lower debt and favorable market conditions.

To reduce its debt load, TRIUMPH in March announced it had completed the sale of its product support business to AAR Corp., a transaction valued at $725 million.

TRIUMPH said it expected the net after-tax proceeds to be approximately $700 million, which it primarily planned to use for debt reduction.

“This transaction enables TRIUMPH to greatly accelerate our deleveraging progress while placing our third-party product support business with a market-leading MRO company that has a proven track record of customer support,” Dan Crowley, TRIUMPH’s chairman, president, and CEO, said at the time. 

“By strengthening our balance sheet and focusing on our OEM component, spares and IP-based aftermarket business, TRIUMPH will further improve its capacity to win and expects to profitably grow in the expanding markets we serve,” said Crowley.

Upon completion of the transaction, TRIUMPH will advance in aerospace and its adjacent markets as a value-added and IP-based business, according to the company, which has 21 sites and roughly 4,500 employees.