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Lufthansa was upgraded to Baa3 from Ba1 by Moody’s. The rating agency also upgraded the ratings of Lufthansa’s senior unsecured debt to Baa3. The upgrade action follows the strong operating performance achieved by the company last year. The company achieved an adjusted EBIT of €3bn ($3.27bn) during the twelve month period till September 2023, resulting in an increase of Moody’s-adjusted retained cash flow/debt ratio to 26.5% from 17.2% at 2022. The rating upgrade also reflects Moody’s view that with the acquisition of the 41% stake in Italian airline ITA, Lufthansa has strengthened its competitive positioning in Europe. The outlook on the entity has remained as stable reflecting Moody’s view that Lufthansa’s financial profile will continue to strengthen further over the next 12-18 months, supported by strong demand in the European airline market and the benefits from the company’s progress in terms of cost reductions.
Lufthansa’s EUR-denominated bonds traded positive with its 3.75% 2028s up by 1point to 98.6%, yielding 4.1%.