Moody’s Lowers Melco Expectations Due to ‘Negative’ Outlook

Moody’s Investors Service Inc has downgraded Melco Resorts Finance Ltd’s corporate and family ratings, as well as senior unsecured ratings, from Ba2 to Ba3. According to an announcement from the firm on Monday, the change was a result of the outlook for the casino operator remaining “negative.”

Melco Resorts Finance is a unit of casino operator Melco Resorts and Entertainment Ltd, which has business in Macau and in the Philippines. It is also in the process of launching substantial operations in Cyprus. However, those plans have been delayed because of the COVID-19 pandemic.

Melco Continues Accumulating Debt
Moody’s anticipates that Melco Resorts’ total adjusted debt, including lease liability, will reach $7.6 billion over the next 12-18 months. This is up from $6.1 billion at the close of 2020 and $4.9 billion by the close of 2019.

Moody’s projects Melco Resorts’ adjusted financial debt/earnings before interest, taxes, and amortization (EBITA) to rise to around 5% to 5.5% in 2023. The firm stated that this would be “meaningfully greater” than the 3.3x reported in 2019.

Source: https://www.casino.org/news/moodys-lowers-melco-expectations-due-to-negative-outlook/