This year's global corporate default tally rose to 37 after five companies defaulted since our last report. The defaulters are:
- Delaware-based consumer products manufacturer Isagenix Worldwide Inc.,
- Mexico-based telecom services provider Maxcom Telecomunicaciones S.A.B. de C.V.,
- India-based retailing fashion and consumer products manufacturer Future Retail Ltd., and
- Two confidential issuers.
Although the default tally continues to rise, it remains well below the 63 defaults at this point last year.
In the U.S. region, defaults are led by oil and gas, with four, as many speculative-grade companies are still struggling to generate break-even cash flow and access capital markets to meet upcoming debt maturities. This is especially true for exploration and production and oilfield services companies. The U.S. trailing-12-month speculative-grade corporate default rate fell for the third consecutive month to 6.3% in March 2021 from 6.4% in February 2021, while the U.S. speculative-grade energy default rate fell to 21.0% from 21.8% in the same period. Although decreasing, both default rates are higher than their five-year averages (see chart 1).
S&P Global Ratings recently raised its price assumptions for Brent and West Texas Intermediate (WTI) crude oil for the remainder of 2021 and 2022, to $60 and $55, respectively. Although the longer-term outlook is improving as companies work off their excess inventory and offshore drilling benefits from improved costs and commodity prices, we believe oilfield services will continue to face near-term headwinds due to the capital constraints in the industry (see "S&P Global Ratings Revises Oil And AECO Natural Gas Price Assumptions And Introduces Dutch Title Transfer Facility Assumption," March 8, 2021).
Chart 1
This Week's Observations
- By sector, global defaults are led by oil and gas, with seven, followed by consumer products, with six (see chart 3).
- The 12-month-trailing speculative-grade default rate for global energy and natural resources dropped slightly in March 2021 to 16.5% from 17.0% in February 2021 (see chart 5).
- The 12-month-trailing speculative grade default rate for Europe increased to 6.1% in March 2021 from 5.4% in February 2021.
Chart 2
Chart 3
Chart 4
Chart 5
Table 1
U.S. Year-To-Date Defaults Are Much Lower In 2021 (22) Than In 2020 (43) | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Region | 12-month-trailing speculative-grade default rate (%) | 2021 YTD | 2020 YTD | 2020 | Weakest links | |||||||
U.S. | 6.3 | 22 | 43 | 146 | 322 | |||||||
Emerging markets | 2.8 | 5 | 8 | 28 | 35 | |||||||
Europe | 6.1 | 9 | 7 | 42 | 84 | |||||||
Other developed | 6.6 | 1 | 5 | 10 | 25 | |||||||
Global | 5.4 | 37 | 63 | 226 | 466 | |||||||
Note: Trailing-12-month default rates from March 31, 2020-March 31, 2021, are preliminary and subject to change. Year-to-date data as of April 28. Weakest link data is as of Jan. 31, 2021. Other developed region is Australia, Canada, Japan, and New Zealand. Default counts may include confidentially rated issuers. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Table 2
The 2021 Global Corporate Default Tally Rises To 37 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Parent company | Country | Subsector | To | From | Reason | ||||||||
5-Jan-21 |
HGIM Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
6-Jan-21 |
Promotora de Informaciones S.A. |
Spain | Media and entertainment | SD | CC | Distressed exchange | ||||||||
8-Jan-21 |
Burger BossCo Intermediate Inc. |
U.S. | Retail/restaurants | SD | CCC | Distressed exchange | ||||||||
8-Jan-21 |
Riverbed Parent Inc. |
U.S. | High technology | SD | CC | Distressed exchange | ||||||||
21-Jan-21 |
AMC Entertainment Holdings Inc. |
U.S. | Media and entertainment | SD | CC | Distressed exchange | ||||||||
25-Jan-21 |
Awesome Acquisition Co. L.P. |
U.S. | Retail/restaurants | D | NR | Chapter 11 | ||||||||
25-Jan-21 |
Alpha Media LLC |
U.S. | Media and entertainment | D | NR | Bankruptcy | ||||||||
27-Jan-21 |
Imagine Group LLC (The) |
U.S. | Media and entertainment | D | CCC | Distressed exchange | ||||||||
2-Feb-21 |
Belk Inc. |
U.S. | Retail/restaurants | D | CC | Missed interest payments | ||||||||
3-Feb-21 |
Peabody Energy Corp. |
U.S. | Metals, mining, and steel | SD | CC | Distressed exchange | ||||||||
3-Feb-21 | Confidential | Confidential | Health care | SD | CCC- | Confidential | ||||||||
11-Feb-21 | Confidential | Confidential | Automotive | D | CCC- | Confidential | ||||||||
11-Feb-21 |
Vallourec |
France | Oil and gas | SD | CC | Missed principal payments | ||||||||
19-Feb-21 |
Renfro Corp. |
U.S. | Consumer products | SD | CCC- | Distressed exchange | ||||||||
22-Feb-21 |
CatLuxe Sarl (CatLuxe Acquisition Sarl) |
Luxembourg | Consumer products | SD | CCC+ | Distressed exchange | ||||||||
22-Feb-21 |
Form Technologies LLC |
U.S. | Capital goods | SD | CC | Distressed exchange | ||||||||
26-Feb-21 |
YPF S.A. |
Argentina | Oil and gas | SD | CC | Distressed exchange | ||||||||
2-Mar-21 |
Sunshine 100 China Holdings Ltd. |
Cayman Islands | Homebuilders/real estate companies | SD | CCC- | Distressed exchange | ||||||||
7-Mar-21 | Confidential | Confidential | Financial institutions | D | NR | Confidential | ||||||||
8-Mar-21 | Confidential | Confidential | Financial institutions | D | B+ | Confidential | ||||||||
16-Mar-21 |
Ensign Drilling Inc. (Ensign Energy Services Inc.) |
Canada | Oil and gas | SD | CCC+ | Distressed exchange | ||||||||
16-Mar-21 |
HighPoint Resources Corp. |
U.S. | Oil and gas | D | CC | Chapter 11 | ||||||||
17-Mar-21 |
Washington Prime Group Inc. |
U.S. | Homebuilders/real estate companies | D | CC | Missed interest payments | ||||||||
18-Mar-21 | Confidential | Confidential | Consumer products | D | CCC | Confidential | ||||||||
23-Mar-21 |
AI Mistral Holdco Ltd. |
U.K. | Transportation | SD | CCC+ | Distressed exchange | ||||||||
26-Mar-21 |
Avation PLC |
U.K. | Transportation | SD | CC | Distressed exchange | ||||||||
13-Apr-21 |
YPF Energia Electrica S.A. (YPF S.A) |
Argentina | Utilities | SD | CCC- | Distressed exchange | ||||||||
14-Apr-21 |
ION Geophysical Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
15-Apr-21 |
Summit Midstream Partners L.P. |
U.S. | Midstream | SD | CC | Distressed exchange | ||||||||
16-Apr-21 |
Basic Energy Services Inc. |
U.S. | Oil and gas | D | CCC- | Missed interest payments | ||||||||
19-Apr-21 |
Medical Depot Holdings Inc. |
U.S. | Health care | SD | CCC+ | Distressed exchange | ||||||||
19-Apr-21 |
Serta Simmons Bedding LLC |
U.S. | Consumer products | SD | CC | Distressed exchange | ||||||||
23-Apr-21 |
Isagenix Worldwide Inc. |
U.S. | Consumer products | SD | CCC | Distressed exchange | ||||||||
26-Apr-21 | Confidential | Confidential | High technology | SD | CCC+ | Confidential | ||||||||
27-Apr-21 |
Maxcom Telecomunicaciones S.A.B. de C.V. |
Mexico | Telecommunications | D | CCC- | Missed interest payments | ||||||||
28-Apr-21 |
Future Retail Ltd. |
India | Retail/restaurants | SD | CCC- | Distressed exchange | ||||||||
28-Apr-21 | Confidential | Confidential | Consumer products | SD | CCC- | Confidential | ||||||||
NR--Not rated. SD--Selective default. Data as of April 28, 2021. *Sunshine 100 China Holdings Ltd. is incorporated in the Cayman Islands but invests, develops, and manages real estate properties in the People’s Republic of China. Companies incorporated in the Cayman Islands are included in the U.S. default rate computation due to the location as a U.S. tax haven. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Related Research
- Future Retail Downgraded To 'SD' On Restructuring Of Onshore Debt; Issue Rating Remains At 'CCC-', April, 29, 2021
- Global Financing Conditions: Bond Issuance Could Decline 2.25% In 2021 To $8.2 Trillion, April 29, 2021
- COVID-19 Impact: Key Takeaways From Our Articles, April 29, 2021
- Mexican Telecom Carrier Maxcom Telecomunicaciones Ratings Lowered To 'D' From 'CCC-' On Missed Interest Payment, April 28, 2021
- The U.S. Distress Ratio Drops To Its Lowest Level In 14 Years, April 27, 2021
- Isagenix Worldwide Inc. Downgraded To 'SD' From 'CCC' On Below-Par Debt Repurchases, April 23, 2021
Default Studies
More analysis and statistics are available in our annual default studies, published on RatingsDirect:
Corporate (financial and nonfinancial)
- 2020 Annual Global Corporate Default And Rating Transition Study
- 2020 Annual Japanese Issuer Credit Rating Transition Study
- 2019 Annual Mexican National Scale Corporate And Public Finance Default And Rating Transition Study
- 2019 Annual Greater China Corporate Default And Rating Transition Study
- 2019 Annual Emerging Markets Corporate Default And Rating Transition Study
- 2019 Annual European Corporate Default And Rating Transition Study
- 2019 Annual Latin American Corporate Default And Rating Transition Study
- 2019 Annual Asia Corporate Default And Rating Transition Study
- 2019 Annual Global Financial Services Default And Rating Transition Study
- 2019 Annual U.S. Corporate Default And Rating Transition Study
- 2019 Annual Taiwan Ratings Corp. Corporate Default And Rating Transition Study
- 2018 Annual Infrastructure Default And Rating Transition Study
- 2017 Annual Australia And New Zealand Corporate Default Study And Rating Transitions
- 2017 Annual Canadian Corporate Default Study And Rating Transitions
- 2017 Inaugural Nordic Default Study And Rating Transitions
- 2017 Annual Brazil Corporate Default Study And Rating Transitions
Structured finance
- 2020 Annual Japanese Structured Finance Default And Rating Transition Study
- 2019 Annual Mexican Structured Finance Default And Rating Transition Study
- 2019 Annual European Structured Finance Default And Rating Transition Study
- 2019 Annual Global Leveraged Loan CLO Default And Rating Transition Study
- 2019 Annual Global Structured Finance Default And Rating Transition Study
- 2019 Annual Taiwan Structured Finance Default And Rating Transition Study
U.S. public finance
- 2019 Annual U.S. Public Finance Default And Rating Transition Study
- 2017 Annual U.S. Public Finance Not-For-Profit Health Care Default Study And Rating Transitions
- 2017 U.S. Public Finance Utility Default Study And Rating Transitions
- 2017 U.S. Public Finance Transportation Default Study And Rating Transitions
- 2017 Annual U.S. Public Finance Housing Default Study And Rating Transitions
- 2017 Annual U.S. Public Finance Charter School Default Study And Rating Transitions
- 2017 Annual U.S. Public Finance Higher Education And Nonprofit Organization Default Study And Rating Transitions
Sovereign and international public finance
- 2020 Annual Sovereign Default And Rating Transition Study
- 2019 Annual International Public Finance Default And Rating Transition Study
This report does not constitute a rating action.
Credit Markets Research: | Nicole Serino, New York + 1 (212) 438 1396; nicole.serino@spglobal.com |
Secondary Contact: | David C Tesher, New York + 212-438-2618; david.tesher@spglobal.com |
Research Contributor: | Shripati Pranshu, Mumbai; shripati.pranshu@spglobal.com |
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