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LatAm Airlines was upgraded to B from B- by S&P following a sharp improvement in credit measures in H2 2023. Healthy air travel demand alongside capacity deployment have kept Latam’s passenger yields about 14% higher than in H1 2022. With economic growth expectations to stay modest with inflation and interest rates set to fall, travel demand is due to be supported. As part of LatAm’s Chapter 11, it was able to cut debt and improve its cost structure. Adjusted debt is expected to be at $7.3bn by end-2023, down from $10.4bn at end-2019. Besides, its lease renegotiations and reduction of fleet costs are set to help its profitability, cashflows and debt reduction over the next two years, the rating agency noted.
LatAm’s 6.875% 2024s were trading stable at 99.95, yielding 6.41%