from 'BB+' to 'BBB-' with a 'stable' outlook. The agency has also upgraded the US carrier's senior secured debt ratings from 'BBB-' to 'BBB', its LaGuardia industrial revenue bonds from 'BB+' to 'BBB', and its unsecured ratings from 'BB+' to 'BBB-'. Delta's credit metrics have "improved considerably after the pandemic", says Fitch, noting that the carrier has reduced gross debt and operating leases roughly $11 billion over the past three years and expects unencumbered assets to total $30 billion by year-end. Fitch notes that Delta's 'BBB-' rating is higher than its two major competitors United Airlines ('BB') and American Airlines ('B+'). Along with its "solid" business profile, Fitch expects Delta to sustain EBITDAR leverage in the mid-2x range and fixed charge coverage of greater than 4x, and to generate consistent positive free cash flow, consistent with an investment-grade credit profile. Fitch observes that Delta made $4.1 billion in debt payments in 2023 and $2.1 billion in the first half of this year, bringing gross debt and lease liabilities to $27 billion from nearly $33 billion at year-end 2022. Delta is also expected to generate healthy operating margins and cash flows in 2024. The agency states that its model "incorporates margin compression in 2024 driven by mostly flat unit revenues and a low-single digit increase in unit costs", adding: "Although results are weaker than the prior year, we expect Delta's profitability to remain among the industry's best. Capacity growth is slowing as the company transitions away from a phase of post-pandemic network restoration." Delta is set to grow capacity in the mid-single-digits across 2024, down from 17% in 2023, with growth mostly focused on its core hubs where it generates its highest margins, Fitch notes.

Boeing has reduced its commercial aircraft presence at the Farnborough air show later this month, versus previous years, and has decided not to participate in the exhibition's airliner flying display amid the company's efforts to improve quality and safety.
The US airframer says it will show a sectional cabin mock-up for its in-development 777X programme and include a Qatar Airways 787-9 in the static display. Activities for Boeing Commercial Airplanes will additionally cover the company's ecoDemonstrator test aircraft, freighter line and joint X-66 sustainable flight demonstrator programme with NASA, it says.
At last year's Paris air show and previous a Farnborough in 2022, Boeing had included test aircraft for its in-development 777-9 and 737 Max 10 programmes in daily flying displays. "We are concentrated on implementing our comprehensive safety and quality plan and meeting our customer commitments. With these priorities in mind, we have reduced our commercial airplanes display and flight demonstrations at the show, and will focus on new technology, sustainability, security and services solutions," states Boeing Global president Brendan Nelson. "The best way to build trust," he adds, "is through high-quality performance in our factories, one airplane at a time." Boeing will include F-15QA fighter jets in flying displays at Farnborough air show during 22-26 July. A US Air Force F-15E, US Army AH-64E Apache and CH-47F Chinook helicopters, and a US Navy P-8A maritime patrol aircraft will be on static display.

Fitch Ratings has withdrawn its rating of SriLankan Airlines' $175 million government-guaranteed 7% unsecured bonds due 25 June 2024, citing "commercial reasons". In a 15 July update, it adds Fitch will "no longer provide ratings or analytical coverage for SriLankan Airlines". In the same commentary, the ratings agency affirms the bonds at 'C', on the basis that it sees "average- to below-average recovery prospects following a default". The airline has missed multiple coupon payments since 2022, triggering events of default. Most recently, it did not pay the interest and principal amount due 25 June, triggering another event of default, but is still within the 30-day grace period. In a 20 June filing to the Singapore exchange, the carrier said it would communicate with bondholders to reach a "mutually agreeable solution". The Sri Lankan government announced in March that it had taken over around $312 million of the carrier's debt owed to Sri Lankan banks, which left the bonds as the next largest debt holding for the carrier. SriLankan is, in the meantime, undergoing a privatisation process.