The 2021 corporate default tally increased to 47, with two defaults this week. The defaulters were:
- Minnesota-based travel services company Carlson Travel Inc., and
- One confidential issuer.
The number of defaults so far in 2021 surpassed defaults at this point in 2018 (46) but remains lower than that in 2020 (120) and 2019 (60). Defaults so far in 2021 have largely come from 'CCC+' or lower ratings--at 92% globally and 89% in the U.S. region--as the lowest-rated issuers tend to be more vulnerable to external market pressures.
In the U.S., upgrades have far outpaced downgrades in the 'CCC' rating category for the sixth consecutive month as 'CCC' net upgrades (upgrades minus downgrades) remain the highest among all other rating categories, which has led to a sharp decrease in the total number of issuers in the rating category. The negative bias (proportion of issuers with negative outlooks or ratings on CreditWatch negative) among 'CCC+' or lower-rated issuers has dropped significantly in the U.S. region to 2015 levels (see chart 1). This signals a further slowdown in downgrades (see "Risky Credits: The 'CCC' Category Leads Speculative-Grade Net Upgrades," June 15, 2021).
This Week's Observations
- By region, the U.S. continues to lead defaults in 2021, with 26 out of 47, but that's lower than at this point in 2020 (79), 2019 (42), and 2018 (30).
- Most defaults have been from the 'CCC+' or lower rating category, although the three-month-trailing default count in the U.S. region has dropped by 80% to 11 from 57 in second-quarter 2020.
- By sector, oil and gas and consumer products have the highest number of defaults so far in 2021 with seven each, followed by media and entertainment, with six (see chart 2).
- Nearly 60% of defaults so far in 2021 are related to distressed exchanges, whereas only 35% were related to distressed exchanges in 2020 (see chart 4).
Chart 1
Chart 2
Chart 3
Chart 4
Table 1
The U.S. Leads 2021 Defaults With 26 Out Of 47 | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Region | 12-month-trailing speculative-grade default rate (%) | 2021 YTD | 2020 YTD | 2020 | Weakest links | |||||||
U.S. | 4.7* | 26 | 79 | 146 | 213 | |||||||
Emerging market | 2.7 | 8 | 16 | 28 | 27 | |||||||
Europe | 5.4* | 11 | 16 | 42 | 66 | |||||||
Other developed | 3.5 | 2 | 9 | 10 | 18 | |||||||
Global | 4.8 | 47 | 120 | 226 | 324 | |||||||
*Trailing-12-month default rates from May 31, 2020-May 31, 2021, are preliminary and subject to change. Year-to-date data as of June 23. Weakest link data is as of May 31, 2021. Other developed region includes 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
2021 Global Corporate Defaults Total 47 | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Parent company | Country | Subsector | To | From | Reason | ||||||||
1/5/21 |
HGIM Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
1/6/21 |
Promotora de Informaciones S.A. |
Spain | Media and entertainment | SD | CC | Distressed exchange | ||||||||
1/8/21 |
Burger BossCo Intermediate Inc. |
U.S. | Retail/restaurants | SD | CCC | Distressed exchange | ||||||||
1/8/21 |
Riverbed Parent Inc. |
U.S. | High technology | SD | CC | Distressed exchange | ||||||||
1/21/21 |
AMC Entertainment Holdings Inc. |
U.S. | Media and entertainment | SD | CC | Distressed exchange | ||||||||
1/25/21 |
Awesome Acquisition Co. L.P. |
U.S. | Retail/restaurants | D | NR | Chapter 11 | ||||||||
1/25/21 |
Alpha Media LLC |
U.S. | Media and entertainment | D | NR | Bankruptcy | ||||||||
1/27/21 |
Imagine Group LLC (The) |
U.S. | Media and entertainment | D | CCC | Distressed exchange | ||||||||
2/2/21 |
Belk Inc. |
U.S. | Retail/restaurants | D | CC | Missed interest payments | ||||||||
2/3/21 |
Peabody Energy Corp. (A) |
U.S. | Metals, mining, and steel | SD | CC | Distressed exchange | ||||||||
2/3/21 | Confidential | Confidential | Health care | SD | CCC- | Confidential | ||||||||
2/11/21 | Confidential | Confidential | Automotive | D | CCC- | Confidential | ||||||||
2/11/21 |
Vallourec |
France | Oil and gas | SD | CC | Missed principal payments | ||||||||
2/19/21 |
Renfro Corp. |
U.S. | Consumer products | SD | CCC- | Distressed exchange | ||||||||
2/22/21 |
CatLuxe Sarl (CatLuxe Acquisition Sarl) |
Luxembourg | Consumer products | SD | CCC+ | Distressed exchange | ||||||||
2/22/21 |
Form Technologies LLC |
U.S. | Capital goods | SD | CC | Distressed exchange | ||||||||
2/26/21 |
YPF S.A |
Argentina | Oil and gas | SD | CC | Distressed exchange | ||||||||
3/2/21 |
Sunshine 100 China Holdings Ltd. |
Cayman Islands | Homebuilders/real estate companies | SD | CCC- | Distressed exchange | ||||||||
3/7/21 | Confidential | Confidential | Financial institutions | D | NR | Confidential | ||||||||
3/8/21 | Confidential | Confidential | Financial institutions | D | B+ | Confidential | ||||||||
3/16/21 |
Ensign Drilling Inc. (Ensign Energy Services Inc.) |
Canada | Oil and gas | SD | CCC+ | Distressed exchange | ||||||||
3/16/21 |
HighPoint Resources Corp. |
U.S. | Oil and gas | D | CC | Chapter 11 | ||||||||
3/17/21 |
Washington Prime Group Inc. |
U.S. | Homebuilders/real estate companies | D | CC | Missed interest payments | ||||||||
3/18/21 | Confidential | Confidential | Consumer products | D | CCC | Confidential | ||||||||
3/23/21 |
AI Mistral Holdco Ltd. |
U.K. | Transportation | SD | CCC+ | Distressed exchange | ||||||||
3/26/21 |
Avation PLC |
U.K. | Transportation | SD | CC | Distressed exchange | ||||||||
4/13/21 |
YPF Energia Electrica S.A. (YPF S.A) |
Argentina | Utilities | SD | CCC- | Distressed exchange | ||||||||
4/14/21 |
ION Geophysical Corp. |
U.S. | Oil and gas | SD | CC | Distressed exchange | ||||||||
4/15/21 |
Summit Midstream Partners, LP |
U.S. | Midstream | SD | CC | Distressed exchange | ||||||||
4/16/21 |
Basic Energy Services Inc. |
U.S. | Oil and gas | D | CCC- | Missed interest payments | ||||||||
4/19/21 |
Medical Depot Holdings Inc. |
U.S. | Health care | SD | CCC+ | Distressed exchange | ||||||||
4/19/21 |
Serta Simmons Bedding LLC |
U.S. | Consumer products | SD | CC | Distressed exchange | ||||||||
4/23/21 |
Isagenix Worldwide, Inc |
U.S. | Consumer products | SD | CCC | Distressed exchange | ||||||||
4/26/21 | Confidential | Confidential | High technology | SD | CCC+ | Confidential | ||||||||
4/27/21 |
Maxcom Telecomunicaciones, S.A.B. de C.V. |
Mexico | Telecommunications | D | CCC- | Missed interest payments | ||||||||
4/28/21 |
Future Retail Ltd. |
India | Retail/restaurants | SD | CCC- | Distressed exchange | ||||||||
4/28/21 | Confidential | Confidential | Consumer products | SD | CCC- | Confidential | ||||||||
4/30/21 |
Codere S.A. |
Spain | Media and entertainment | SD | CC | Distressed exchange | ||||||||
5/3/21 | Confidential | Confidential | Transportation | D | CC | Confidential | ||||||||
5/10/21 |
gategroup Holding AG |
Switzerland | Transportation | SD | CCC | Distressed exchange | ||||||||
5/10/21 |
Voyager Aviation Holdings LLC |
U.S. | Transportation | SD | CC | Distressed exchange | ||||||||
5/14/21 |
CDRH Parent Inc. |
U.S. | Health care | D | CC | Distressed exchange | ||||||||
5/19/21 |
Boart Longyear Ltd. |
Australia | Metals, mining, and steel | D | CC | Bankruptcy | ||||||||
5/25/21 | Confidential | Confidential | Homebuilders/real estate companies | D | CCC- | Confidential | ||||||||
6/3/21 |
Peabody Energy Corp. (B) |
U.S. | Metals, mining, and steel | SD | CCC+ | Distressed exchange | ||||||||
6/23/21 |
Carlson Travel Inc |
U.S. | Media and entertainment | D | CCC | Missed interest payments | ||||||||
6/23/21 | Confidential | Confidential | Consumer products | D | CCC- | Confidential | ||||||||
(B)designation indicates the issuer's second default for 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. NR--Not rated. SD--Selective default. Data as of June 23, 2021. Sources: S&P Global Ratings Research and S&P Global Market Intelligence’s CreditPro®. |
Related Research
- U.S.-Based Carlson Travel Inc. Downgraded To 'D' On Forbearance And Missed Interest Payment, June 24, 2021
- Nearly A Quarter Of Weakest Links Have Defaulted Since February 2020, June 23, 2021
- S&P Global Ratings Raises Short-Term Oil And Gas Price Assumptions On Improving Market Conditions, June 16, 2021
- The U.S. Distress Ratio Drops To Just 2.6%, June 14, 2021
- Global State Of Play 2021: Low Interest Rates Have Fueled A Rise In Credit Market Debt, June 11, 2021
- The U.S. Speculative-Grade Corporate Default Rate Could Fall To 4% By March 2022, May 26, 2021
Default Studies
More analysis and statistics are available in our annual default studies, published on RatingsDirect:
Corporate (financial and nonfinancial)
- 2020 Annual Asia Corporate Default And Rating Transition Study
- 2020 Annual Taiwan Ratings Corp. Corporate Default And Rating Transition Study
- 2020 Annual U.S. Corporate Default And Rating Transition Study
- 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 Global Financial Services Default And Rating Transition Study
- 2019 Annual U.S. 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 Taiwan Structured Finance Default And Rating Transition Study
- 2020 Annual Global Structured Finance Default And Rating Transition Study
- 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
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, CRISIL Global Analytical Center, an S&P affiliate, Mumbai |
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