Rating Release

Agusto & Co. hereby assigns a “Bbb-” rating to Ibom Airlines Limited

The rating expires on 30 June 2024.

Agusto & Co. hereby assigns a “Bbb-” rating to Ibom Airlines Limited (“Ibom Air”, “IAL” or “the Company”). The rating is an upward notching of the standalone rating of Ibom Airlines Limited under our credit enhancement criteria based on the strong financial support from the Akwa Ibom State Government (“AISG” or “the State”) – its ultimate parent. The rating also considers Ibom Air’s expanding fleet capacity, which has continued to sustain its growing domestic footprint, as well as the prospects of foreign exchange earnings from the proposed commencement of regional flight operations that should help to build some resilience against foreign exchange risks. However, the rating is constrained by IAL’s weak profitability as deteriorating market fundamentals (soaring jet fuel costs and persistent depreciation in the value of the local currency) continue to weigh on its operating costs and profit margins. The rating is further moderated by the Company’s rising debt profile as well as concerns over the exposure of its operations to political risks.

The opinions expressed in this rating release do not represent investment or other advice and should therefore not be construed as such. Visit www.agusto.com for further information.