AIRPORTS COMPANY SOUTH AFRICA SOC LIMITED - BIACSA-Rating Action

BIACSA-Rating Action

Airports Company South Africa SOC Limited
(Incorporated in the Republic of South Africa)
(Registration number 1993/004149/30)
(“ACSA”) or (“the Company”)


ACSA RATING ACTION BY MOODY’S INVESTOR SERVICES

In accordance with paragraph 4.24 of the JSE Debt Listings Requirements,
noteholders are hereby advised that on 26 June 2020, Moody’s Investors
Service (Moody’s) downgraded Airports Company South Africa’s corporate
family rating to Ba2 from Ba1 and national scale rating to Aa3.za from
Aa2.za. The outlook has been changed to negative from ratings under
review. This concludes the review process initiated on 31 March 2020.

The downgrade takes account of ACSA’s rising credit and liquidity risks
due to the sharp decline in traffic as a result of implementation of
travel restrictions.

Further details on the rating action can be viewed on the following
link:

https://www.moodys.com/research/Moodys-downgrades-ACSAs-rating-to-Ba2-negative-outlook--
PR_427251

Airports Company South Africa notes the decision by Moody’s to downgrade
its ratings.

Moody’s stated that the rapid spread of the coronavirus outbreak, severe
global economic shock, low oil prices, and asset price volatility are
creating a severe and extensive credit shock across many sectors,
regions, and markets.

The combined credit effects of these developments are unprecedented.
Globally, airports have been among the sectors most significantly
affected by the shock, given their exposure to travel restrictions and
sensitivity to consumer demand and sentiment

As set out in recent engagements with key stakeholders, Airports Company
South Africa’s financial performance has been severely impacted by the
travel restrictions imposed by governments around the world in response
to the Covid-19 pandemic.
In response, the company has revised its financial plan in line with its
“New Normal” scenario anticipating that the impact on traffic volume
demand and airline sustainability will be long-term. The revised
financial plan includes significant responses to mitigate the impact of
the traffic volume decline anticipated. These include deep reductions
in operational expenditure and limitations to capital expenditure.

Airports Company South Africa has in recent days made important progress
in implementing plans to secure funding and to ensure its immediate
sustainability.

The company received approval from its key lender, L’Agence Francaise
De Developpement (AFD), to waive its right to call a default in respect
of the in-compliance with projected ratios until 30 June 2022, given the
extraordinary context of COVID-19.

Further, to bolster its liquidity profile, the company confirmed the
approvals of the extension and an increase of its banking facilities
from R1.5 billion to R3 billion for a period of 12 months. The available
liquidity will be adequate given low levels of debt maturities of R296
million in the next 12 months.

The company will continue to implement appropriate responses to maintain
a prudent financial profile and engage with key stakeholders, in
particular airlines, lenders, economic regulator, and shareholders in
an effort to mitigate the credit effects of these unprecedented
developments for the global aviation sector.


Johannesburg
29 June 2020
Debt Sponsor
The Standard Bank of South Africa Limited

Date: 29-06-2020 11:27:00
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