Key Takeaways
- Global corporate defaults amounted to nine in July, the same number as in June. The global year-to-date default tally stands at 87, just above the five-year average of 86 and slightly below the 2023 year-to-date count of 91.
- Distressed exchanges accounted for two-thirds of defaults in July, represent over 50% of year-to-date defaults, and are at their highest level since 2009.
- The number of defaults in Europe exceeded the 2023 year-to-date count by 86%, compared with a 13% decline in the U.S., and reached its highest level since 2008.
- The monthly defaulted debt amount reached its second-lowest level in 2024 and declined by 21.9% to $6.4 billion in July, compared with about $8.1 billion in June.
S&P Global Ratings' 2024 global corporate default tally reached 87 after the following defaults in July:
- Sweden-based real estate company Samhällsbyggnadsbolaget i Norden AB (publ)
- Ukrainian electricity producer DTEK Renewables B.V.
- U.S.-based skincare company Rodan & Fields LLC
- Dutch fashion retailer Hunkemöller International B.V.
- U.S.-based motion picture exhibitor AMC Entertainment Holdings Inc.
- U.S.-based sewing machine and accessories company Stitch Acquisition Corp.
- France-based IT services group Atos SE
- U.S.-based hospital and outpatient services provider Quincy Health LLC
- U.S.-based durable consumer goods and services provider Conn's Inc.
Europe Accounted For Almost Half Of All Defaults
Nine companies defaulted in July, the same number as in June and compared with seven in July 2023. However, the global year-to-date corporate default tally is still elevated at 87, which is just above the five-year average of 86 and only slightly below the 2023 year-to-date count of 91 (see chart 1).
Defaults in Europe continued to rise and accounted for 44% of total defaults in July. Europe is the only region where defaults have exceeded 2023 levels, with 26 defaults recorded--a significant increase of 86%, compared with the 2023 year-to-date count, and the highest number since 2008.
We expect a 12-month trailing speculative-grade corporate default rate for Europe of 3.75% by March 2025, down from 4.7% as of June 30, 2024 (see chart 2). In our pessimistic scenario, we forecast that slower-than-expected economic growth, higher-than-expected interest rates, and a higher acceptance of distressed exchanges could keep the default rate elevated over the medium term.
Chart 1
Chart 2
Distressed Exchanges Are At Their Highest Level Since 2009
Distressed exchanges led defaults in July and accounted for two-thirds of total defaults. They remain a leading cause of defaults in 2024, with 45 distressed exchanges in the first seven months of 2024. The total count, which is 18% higher than in the same period last year, is at the highest level since 2009 (see chart 3). The increase in distressed exchanges partly results from a growing number of repeat defaulters, which are companies that have already defaulted at least once. Repeat defaulters accounted for close to one-third of year-to-date defaults (see chart 4).
The number of repeat defaulters increased in recent years, not least due to the fact that more companies become comfortable with high leverage levels in their capital structures, many of which were set up during--and in anticipation of--sustained periods of low interest rates (see "The Rise of Repeat Defaulters," published on April 11, 2024).
Chart 3
Chart 4
Total Defaulted Debt Decreased By More Than One-Fifth
Although the number of defaults remained the same over June and July, with nine defaults in each month, the defaulted debt amount decreased over the same period, both in Europe and the U.S. Year to date, the monthly defaulted debt amount has only been lower in January (see chart 5). The share of U.S. defaulted debt slightly increased to 63.9% of total defaulted debt but remains below the year-to-date high of 98.2% in February.
Chart 5
Consumer Products Led Defaults In July
The media and entertainment sector recorded most defaults year to date, totaling 16, with 62.5% resulting from distressed exchanges (see chart 6). Many speculative-grade issuers in this and other sectors remain vulnerable, primarily due to high leverage, negative free cash flows, or looming refinancing needs over the next 12-18 months, which could potentially cause more defaults. The media and entertainment sector has the most speculative-grade debt maturing through 2025, at $65.7 billion as of July 1, 2024.
That said, the consumer products sector accounted for one-third of defaults in July. Lower-rated issuers in this sector continue to suffer from higher interest rates, low-income consumers' reduced spending, the cumulative effect of inflation since mid-2023, and higher promotional spending in margin recovery.
Chart 6
Table 1
Weakest links decreased in July but estimated default rates are elevated | ||||||
---|---|---|---|---|---|---|
Region | 12-month trailing speculative-grade default rate (%) | Weakest links | ||||
U.S. | 4.42* | 194 | ||||
Emerging markets | 1.9 | 13 | ||||
Europe | 4.81* | 46 | ||||
Other developed | 4.4 | 12 | ||||
Global | 4.0 | 265 | ||||
*12-month trailing speculative-grade default rates are from July 31, 2023 to July 31, 2024, preliminary, and subject to change. Other 12-month trailing data as of July 31, 2024. Weakest link data as of June 30, 2024. Other developed includes Australia, Canada, Japan, and New Zealand. Default counts may include confidentially rated issuers. Sources: S&P Global Ratings Credit Research, S&P Global Market Intelligence's CreditPro®. |
Table 2
Year-to-date global corporate defaults | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Date | Parent company | Country/market | Subsector | To | From | Reason | ||||||||
Jan. 2, 2024 |
Resolute Investment Managers Inc. |
U.S. | Financial institutions | D | CC | Distressed exchange | ||||||||
Jan. 4, 2024 |
Toro Private Holdings I Ltd. |
U.K. | Transportation | D | CC | Distressed exchange | ||||||||
Jan. 5, 2024 |
AMT TopCo LLC |
U.S. | Health care | D | CCC | Missed payments | ||||||||
Jan. 10, 2024 |
Ignition Topco B.V. |
Netherlands | Chemicals, packaging, and environmental services | D | CCC | Missed payments | ||||||||
Jan. 11, 2024 |
Amphora Intermediate II Ltd. |
U.K. | Consumer products | SD | CCC+ | Missed payments | ||||||||
Jan. 11, 2024 | Confidential | Confidential | Metals, mining, and steel | SD | CC | Confidential | ||||||||
Jan. 16, 2024 |
Covis Finco S.a.r.l. |
Switzerland | Health care | SD | CCC- | Distressed exchange | ||||||||
Jan. 17, 2024 |
TMK Hawk Parent Corp. |
U.S. | Consumer products | SD | CC | Distressed exchange | ||||||||
Jan. 18, 2024 |
KNS Holdco LLC |
U.S. | Consumer products | SD | B- | Distressed exchange | ||||||||
Jan. 19, 2024 |
System1 Inc. |
U.S. | Media and entertainment | SD | CCC | Distressed exchange | ||||||||
Jan. 24, 2024 |
New Trojan Parent Inc. |
U.S. | Consumer products | D | CCC- | Bankruptcy | ||||||||
Jan. 26, 2024 |
Gol Linhas Aereas Inteligentes S.A. |
Brazil | Transportation | D | CCC- | Bankruptcy | ||||||||
Jan. 31, 2024 |
AMC Entertainment Holdings Inc. (A) |
U.S. | Media and entertainment | SD | CCC+ | Distressed exchange | ||||||||
Jan. 31, 2024 |
Enjoy S.A. |
Chile | Media and entertainment | D | CCC- | Bankruptcy | ||||||||
Feb. 5, 2024 |
Cano Health Inc. |
U.S. | Health care | D | CCC- | Bankruptcy | ||||||||
Feb. 6, 2024 |
Astro Intermediate Holding II Corp. |
U.S. | Consumer products | SD | CCC | Missed payments | ||||||||
Feb. 8, 2024 |
Pluto Acquisition I Inc. |
U.S. | Health care | SD | CC | Distressed exchange | ||||||||
Feb. 9, 2024 | Confidential | Confidential | Telecommunications | D | CC | Confidential | ||||||||
Feb. 14, 2024 |
CLISA-Compania Latinoamericana de Infraestructura & Servicios S.A. |
Argentina | Capital goods | SD | CC | Distressed exchange | ||||||||
Feb. 14, 2024 |
GoTo Group Inc. |
U.S. | High technology | SD | CCC+ | Distressed exchange | ||||||||
Feb. 15, 2024 |
AFE S.A. SICAV-RAIF |
U.K. | Financial Institutions | SD | CC | Distressed exchange | ||||||||
Feb. 16, 2024 |
Enviva Inc. |
U.S. | Utility | D | CCC- | Missed payments | ||||||||
Feb. 16, 2024 |
Range Parent Inc. |
U.S. | Capital goods | D | CCC- | Bankruptcy | ||||||||
Feb. 20, 2024 |
Vue Entertainment International Ltd. |
U.K. | Media and entertainment | SD | CC | Distressed exchange | ||||||||
Feb. 21, 2024 |
Hornblower HoldCo LLC |
U.S. | Media and entertainment | D | CCC- | Bankruptcy | ||||||||
Feb. 21, 2024 |
Tribe Buyer LLC |
U.S. | Media and entertainment | D | CCC- | Missed payments | ||||||||
Feb. 23, 2024 |
Avison Young (Canada) Inc. |
Canada | Financial Institutions | SD | CCC | Missed payments | ||||||||
Feb. 26, 2024 |
Apex Tool Group LLC |
U.S. | Forest products and building materials | SD | CCC+ | Distressed exchange | ||||||||
Feb. 26, 2024 |
Radiology Partners Holdings LLC |
U.S. | Health care | SD | CC | Distressed exchange | ||||||||
Mar. 5, 2024 |
Curo Group Holdings Corp. |
U.S. | Financial Institutions | SD | CCC- | Missed payments | ||||||||
Mar. 18, 2024 |
Hurtigruten Group AS |
Norway | Media and entertainment | SD | CC | Distressed exchange | ||||||||
Mar. 19, 2024 |
JOANN Inc. |
U.S. | Retail/restaurants | D | CCC | Bankruptcy | ||||||||
Mar. 22, 2024 |
Lumen Technologies Inc. |
U.S. | Telecommunications | SD | CC | Distressed exchange | ||||||||
Mar. 27, 2024 |
Samhallsbyggnadsbolaget i Norden AB (publ) |
Sweden | Homebuilders/real estate companies | SD | CCC+ | Distressed exchange | ||||||||
Mar. 29, 2024 |
Atlas Midco Inc. |
U.S. | High technology | D | CCC+ | Distressed exchange | ||||||||
Mar. 29, 2024 |
Aventiv Technologies LLC |
U.S. | Telecommunications | SD | CC | Distressed exchange | ||||||||
Mar. 29, 2024 |
La Financiere Atalian SAS |
France | Consumer products | D | CC | Distressed exchange | ||||||||
Apr. 1, 2024 |
Wom S.A. |
Chile | Telecommunications | D | CCC | Bankruptcy | ||||||||
Apr. 3, 2024 |
Rackspace Technology Global Inc. |
U.S. | High technology | SD | CCC- | Distressed exchange | ||||||||
Apr. 4, 2024 |
Never Slip Topco Inc. |
U.S. | Consumer products | D | CCC- | Bankruptcy | ||||||||
Apr. 5, 2024 |
Arvos LuxCo S.a.r.l. |
Luxembourg | Capital goods | D | CC | Distressed exchange | ||||||||
Apr. 5, 2024 |
Baffinland Iron Mines Corp. |
Canada | Metals, mining, and steel | SD | CCC | Distressed exchange | ||||||||
Apr. 5, 2024 |
Casa Systems Inc. |
U.S. | High technology | D | CCC+ | Bankruptcy | ||||||||
Apr. 5, 2024 |
ConvergeOne Holdings Inc. |
U.S. | Media and entertainment | D | CCC+ | Bankruptcy | ||||||||
Apr. 8, 2024 |
Loparex Midco B.V. |
Netherlands | Forest products and building materials | SD | CCC+ | Distressed exchange | ||||||||
Apr. 9, 2024 | Confidential | Confidential | Media and entertainment | D | CCC- | Confidential | ||||||||
Apr. 10, 2024 |
99 cents only stores LLC |
U.S. | Retail/restaurants | D | CCC | Bankruptcy | ||||||||
Apr. 22, 2024 |
Express Inc. |
U.S. | Consumer products | D | NR | Bankruptcy | ||||||||
Apr. 23, 2024 |
City Brewing Company LLC, (Blue Ribbon Holdings LLC) |
U.S. | Consumer products | SD | CCC | Distressed exchange | ||||||||
Apr. 24, 2024 |
EyeCare Partners LLC |
U.S. | Health care | SD | CCC | Distressed exchange | ||||||||
Apr. 25, 2024 | Confidential | Confidential | Homebuilders/real estate companies | SD | CCC+ | Confidential | ||||||||
Apr. 29, 2024 |
Digital Media Solutions Inc. |
U.S. | Media and entertainment | SD | CCC | Distressed exchange | ||||||||
Apr. 29, 2024 |
Keter Group B.V. |
Netherlands | Consumer products | SD | CC | Distressed exchange | ||||||||
Apr. 29, 2024 |
Xplore Inc. |
Canada | Telecommunications | D | CCC- | Missed payments | ||||||||
Apr. 29, 2024 | Confidential | Confidential | Retail/restaurants | SD | CCC+ | Confidential | ||||||||
May. 6, 2024 |
Cumulus Media Inc. |
U.S. | Media and entertainment | SD | CC | Distressed exchange | ||||||||
May. 6, 2024 |
Steward Health care System LLC |
U.S. | Health care | D | NR | Bankruptcy | ||||||||
May. 10, 2024 |
Farfetch Ltd. |
U.K. | Retail/restaurants | D | CC | Missed payments | ||||||||
May. 16, 2024 |
Credivalores - Crediservicios SAS |
Colombia | Financial institutions | D | NR | Bankruptcy | ||||||||
May. 17, 2024 |
Petrofac Ltd. |
Jersey | Oil & Gas | SD | CCC- | Missed payments | ||||||||
May. 20, 2024 |
Global Medical Response Inc. (Air Medical Holdings LLC) |
U.S. | Health care | SD | CC | Distressed exchange | ||||||||
May. 21, 2024 |
Compact Bidco B.V. |
Netherlands | Forest products and building materials | SD | CCC- | Missed payments | ||||||||
May. 21, 2024 |
Zachry Holdings Inc. |
U.S. | Capital goods | D | NR | Bankruptcy | ||||||||
May. 22, 2024 | Confidential | Confidential | Retail/restaurants | D | CCC | Confidential | ||||||||
May. 22, 2024 |
New Insight Holdings Inc. |
U.S. | Media and entertainment | D | NR | Bankruptcy | ||||||||
May. 23, 2024 |
Astra Acquisition Corp. |
U.S. | High technology | SD | CCC | Distressed exchange | ||||||||
May. 28, 2024 |
Safari Beteiligungs Gmbh |
Germany | Media and entertainment | D | CCC+ | Distressed exchange | ||||||||
May. 28, 2024 |
Maverick Gaming LLC |
U.S. | Media and entertainment | D | CCC | Distressed exchange | ||||||||
May. 30, 2024 |
AMC Entertainment Holdings Inc.(B) |
U.S. | Media and entertainment | SD | CCC+ | Distressed exchange | ||||||||
Jun. 3, 2024 |
Sound Inpatient Physicians Inc. (Sound Inpatient Physicians Holdings LLC) |
U.S. | Health care | D | CC | Distressed exchange | ||||||||
Jun. 11, 2024 |
Valcour Packaging LLC |
U.S. | Chemicals, packaging, and environmental services | SD | CCC- | Distressed exchange | ||||||||
Jun. 12, 2024 |
Vyaire Medical Inc. |
U.S. | Health care | D | CCC | Bankruptcy | ||||||||
Jun. 14, 2024 | Confidential | Confidential | Forest products and building materials | D | CCC | Confidential | ||||||||
Jun. 18, 2024 |
Premier Dental Services Inc. |
U.S. | Health care | SD | CC | Distressed exchange | ||||||||
Jun. 19, 2024 |
OQ Chemicals International Holding GmbH |
Germany | Chemicals, packaging, and environmental services | D | CCC- | Missed payments | ||||||||
Jun. 21, 2024 |
Office Properties Income Trust |
U.S. | Homebuilders/real estate companies | SD | CC | Distressed exchange | ||||||||
Jun. 24, 2024 |
Adler Group S.A. |
Luxembourg | Homebuilders/real estate companies | SD | CCC- | Distressed exchange | ||||||||
Jun. 25, 2024 |
Pro.Gest SpA |
Italy | Forest products and building materials | SD | CCC | Missed payments | ||||||||
Jul. 3, 2024 |
Samhallsbyggnadsbolaget i Norden AB (publ) (B) |
Sweden | Homebuilders/real estate companies | SD | CCC | Distressed exchange | ||||||||
Jul. 18, 2024 |
DTEK Renewables B.V. |
Netherlands | Utility | SD | CCC- | Distressed exchange | ||||||||
Jul. 18, 2024 |
Rodan & Fields LLC |
U.S. | Consumer products | D | CCC- | Missed payments | ||||||||
Jul. 22, 2024 |
Hunkemoller International B.V. |
Netherlands | Consumer products | SD | CCC+ | Distressed exchange | ||||||||
Jul. 23, 2024 |
AMC Entertainment Holdings Inc. (C) |
U.S. | Media and entertainment | SD | CCC+ | Distressed exchange | ||||||||
Jul. 23, 2024 |
Conn's Inc. |
U.S. | Retail/restaurants | D | NR | Bankruptcy | ||||||||
Jul. 24, 2024 |
Stitch Acquisition Corp. |
U.S. | Consumer products | SD | CCC- | Distressed exchange | ||||||||
Jul. 26, 2024 |
Atos SE |
France | High technology | SD | CCC- | Missed payments | ||||||||
Jul. 29, 2024 |
Quincy Health LLC |
U.S. | Health care | SD | CCC- | Distressed exchange | ||||||||
Data as of July 31, 2024. SD--Selective default. NR--Not rated. Sources: S&P Global Ratings Credit Research & Insights, S&P Global Market Intelligence's CreditPro®. |
Related Research
- Global Refinancing Update For Q3 2024 Sees Near-Term Risk Easing, July 29, 2024
- Global Credit Markets Update Q3 2024: On An Upward Curve, July 29, 2024
- Quincy Health LLC Downgraded To 'SD' On Distressed Transactions; Term Loan Rating Lowered To 'D', July 29, 2024
- Atos SE Downgraded To 'SD' On Entering Accelerated Safeguard Proceedings, July 26, 2024
- Stitch Acquisition Corp. Downgraded To 'SD' (Selective Default) On Deferred Principal Payment, Modified Interest Terms, July 25, 2024
- AMC Entertainment Holdings Inc. Rating Lowered To 'SD' On Announcement Of Transaction, July 24, 2024
- Dutch Lingerie Retailer Hunkemoller Downgraded To 'SD' On Completion of Distressed Debt Exchange; All Ratings Withdrawn, July 22, 2024
- Rodan & Fields LLC Downgraded To 'D' From 'CCC-' On Missed Interest And Amortization Payments And Forbearance Agreement, July 19, 2024
- Ukrainian Electricity Producer DTEK Renewables Rating Lowered To 'SD' After Distressed Debt Exchange, July 18, 2024
- Industry Credit Outlook Update North America: Consumer Products, July 18, 2024
- Industry Credit Outlook Update Europe: Consumer Products, July 18, 2024
- Swedish Real Estate Company SBB Downgraded To 'SD' On Accepted Below Par Exchange Offer, July 3, 2024
- The European Speculative-Grade Default Rate Should Level Out At 3.75% By March 2025, May 22, 2024
- Resilient Growth, Resilient Yields, And Resilient Defaults To Bring The U.S. Speculative-Grade Corporate Default Rate To 4.5% By March 2025, May 16, 2024
- The Rise of Repeat Defaulters, April 11, 2024
Default Studies
More analysis and statistics are available in our annual default studies, published on RatingsDirect:
Corporate (financial and non-financial)
- 2023 Annual Global Financial Services Default And Rating Transition Study
- 2023 Annual Global Corporate Default And Rating Transition Study
- 2023 Annual U.S. Corporate Default And Rating Transition Study
- 2023 United Kingdom Corporate Default And Rating Transition Study
- 2023 Annual European Corporate Default And Rating Transition Study
- 2023 Annual Japanese Corporate Default And Rating Transition Study
- 2022 Annual Asia Corporate Default And Rating Transition Study
- 2023 Annual Taiwan Ratings Corp. Corporate Default And Rating Transition Study
- 2023 Annual Emerging And Frontier Markets Corporate Default And Rating Transition Study
- 2023 Annual Greater China Corporate Default And Rating Transition Study
Structured finance
- 2023 Annual Global Structured Finance Default And Rating Transition Study
- 2022 Annual Japanese Structured Finance Default And Rating Transition Study
- 2022 Annual European Structured Finance Default And Rating Transition Study
- 2023 Annual Taiwan Ratings Corp. Structured Finance Default And Rating Transition Study
- 2022 Annual Mexican Structured Finance Default And Rating Transition Study
- 2023 Annual Global Leveraged Loan CLO Default And Rating Transition Study
Public finance
- 2023 Annual U.S. Public Finance Default And Rating Transition Study
- 2022 Annual International Public Finance Default And Rating Transition Study
- 2022 Annual Mexican National Scale Corporate And Public Finance Default And Rating Transition Study
Sovereign and international public finance
This report does not constitute a rating action.
Credit Research & Insights: | Ekaterina Tolstova, Frankfurt +49 173 6591385; ekaterina.tolstova@spglobal.com |
Nicole Serino, New York + 1 (212) 438 1396; nicole.serino@spglobal.com | |
Research Contributor: | Vaishali Singh, CRISIL Global Analytical Center, an S&P affiliate, Mumbai |
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