Moody's changed its outlook of plane lessor Dubai Aerospace Enterprise to stable from 'rating under review'. Courtesy of DAE
Moody's changed its outlook of plane lessor Dubai Aerospace Enterprise to stable from 'rating under review'. Courtesy of DAE
Moody's changed its outlook of plane lessor Dubai Aerospace Enterprise to stable from 'rating under review'. Courtesy of DAE
Moody's changed its outlook of plane lessor Dubai Aerospace Enterprise to stable from 'rating under review'. Courtesy of DAE

Moody's upgrades DAE on improved funding


Deena Kamel
  • English
  • Arabic

Credit ratings agency Moody's upgraded Dubai Aerospace Enterprise (DAE)'s corporate family rating to 'Baa3' reflecting the company's improved funding structure and liquidity.

In addition to the investment upgrade from Ba1, the agency changed its outlook of the Dubai plane lessor to stable from 'rating under review'. Moody's also upgraded the senior unsecured rating of subsidiary DAE Funding LLC to 'Baa3' from 'Ba2.'

In addition to DAE's improved funding structure and liquidity, Moody's said "lower leverage, and further progress obtaining repayment of a large loan to its shareholder, the Investment Corporation of Dubai (ICD)", underpinned it rating action. The Baa3 rating, Moody's said, incorporates its "expectation that DAE will obtain repayment of its loan to its shareholder."

Last year, DAE committed to deliver more than $1.75 billion (Dh6.4bn) in aircraft assets. It increased its managed portfolio to more than 125 aircraft valued at $3.5bn. The lessor also issued $1.9bn of new unsecured debt.

“We have worked assiduously over the last two years to position our franchise to be rated as an investment grade company," Firoz Tarapore, chief executive of DAE, said in a separate statement.

"DAE's senior unsecured debt is now rated investment grade by three major US credit rating agencies. This will enable us to further solidify our top 10 franchise, accelerate our growth ambitions and strengthen our liquidity and capital position”.

DAE has increased its funding diversification by issuing a higher ratio of unsecured debt and reducing encumbered assets, a move that improves its ability to finance and manage the composition of its fleet, Moody's said.

The company's ratio of secured debt to tangible assets improved, declining to 27 per cent at September 30, 2019 from 35 per cent at December 31 2018.

DAE has more than doubled its revolving credit borrowing capacity since mid-2018.

"Moody's expects that DAE will manage its debt maturities to avoid concentrations that could increase its refinancing risks," and the state-owned lessor will continue to maintain "adequate" capital strength as it pursues "modest" fleet growth, according to the report.

Moody's could upgrade its ratings if DAE generates profitability that compares well with investment-grade peers, it said.

In terms of the climate-change concerns surrounding the aviation industry, Moody's said it expects DAE will pursue aircraft investments that reflect the shifting operating priorities of airlines to address environmental concerns.

Some credit challenges facing DAE include that the plane lessor does not currently have new aircraft orders with plane makers, relying instead on sale leaseback and trading activities to replenish its fleet, the agency said.

The ratings reflect "the company's asset and risk management strengths, the earnings and funding advantages associated with the company's unique access to capital and customers in the United Arab Emirates, and its balanced aircraft fleet composition," Moody's said.

UAE currency: the story behind the money in your pockets
Dubai works towards better air quality by 2021

Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.

The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.

These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.

“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.

“We’re in a good position except for the cases that are out of our hands, such as sandstorms.

“Sandstorms are our main concern because the UAE is just a receiver.

“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”

Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.

There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.

“There are 25 stations in total,” Mr Al Daraji said.

“We added new technology and equipment used for the first time for the detection of heavy metals.

“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”

Developer: Ubisoft Montreal / Ubisoft Toronto
Publisher: Ubisoft
Platforms: Playstation 4, Xbox One, Windows
​​​​​​​Release Date: April 10

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Dates for the diary

To mark Bodytree’s 10th anniversary, the coming season will be filled with celebratory activities:

  • September 21 Anyone interested in becoming a certified yoga instructor can sign up for a 250-hour course in Yoga Teacher Training with Jacquelene Sadek. It begins on September 21 and will take place over the course of six weekends.
  • October 18 to 21 International yoga instructor, Yogi Nora, will be visiting Bodytree and offering classes.
  • October 26 to November 4 International pilates instructor Courtney Miller will be on hand at the studio, offering classes.
  • November 9 Bodytree is hosting a party to celebrate turning 10, and everyone is invited. Expect a day full of free classes on the grounds of the studio.
  • December 11 Yogeswari, an advanced certified Jivamukti teacher, will be visiting the studio.
  • February 2, 2018 Bodytree will host its 4th annual yoga market.
England 12-man squad for second Test

v West Indies which starts Thursday: Rory Burns, Joe Denly, Jonny Bairstow, Joe Root (captain), Jos Buttler, Ben Stokes, Moeen Ali, Ben Foakes, Sam Curran, Stuart Broad, Jimmy Anderson, Jack Leach

UAE currency: the story behind the money in your pockets
The specs: 2019 Haval H6

Price, base: Dh69,900

Engine: 2.0-litre turbocharged four-cylinder

Transmission: Seven-speed automatic

Power: 197hp @ 5,500rpm

Torque: 315Nm @ 2,000rpm

Fuel economy, combined: 7.0L / 100km

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills