Target Hospitality Receives S&P Credit Upgrade to B+ Supported by Positive Outlook on Humanitarian Contract

Rhea-AI Summary

Target Hospitality, located in The Woodlands, Texas, reported on April 10, 2023, that S&P Global Ratings upgraded its credit rating to B+ and its Senior Secured Notes rating to BB- on April 6, 2023. This upgrade reflects the company's strong earnings momentum and successful strategic diversification. Target's progress toward securing a multi-year contract for the Expanded Humanitarian Community, initially announced on July 6, 2022, has also contributed to this positive outlook. Furthermore, the company has significantly strengthened its balance sheet by reducing total indebtedness by over $350 million since 2020, including a $125 million partial redemption of Senior Notes in March 2023. These achievements have enhanced Target's capital structure and intrinsic value, laying groundwork for future growth.

Positive

• S&P upgraded Target Hospitality's credit rating to B+ and Senior Notes to BB-.
• Achieved strategic diversification and earnings momentum.
• Secured progress toward a multi-year contract for the Expanded Humanitarian Community.
• Reduced total debt by over $350 million since 2020.
• Completed a $125 million partial redemption of Senior Notes in March 2023.

Negative

• None.

THE WOODLANDS, Texas, April 10, 2023 /PRNewswire/ -- Target Hospitality Corp. ("Target Hospitality," "Target" or the "Company") (Nasdaq: TH), one of North America's largest providers of vertically integrated modular accommodations and value-added hospitality services, announced that on April 6, 2023, S&P Global Ratings upgraded the Company's credit rating to B+ and its Senior Secured Notes due 2024 ("Senior Notes") rating to BB-, representing a one and two notch upgrade, respectively.    

These upgrades reflect the sustained earnings momentum Target has achieved through its focused strategic diversification efforts and continued progress towards a multi-year contract award for the Expanded Humanitarian Community, which the Company previously announced on July 6, 2022. 

Further, Target has achieved its strategic objective to materially strengthen its balance sheet through focused capital discipline and a commitment to reducing total indebtedness.  Inclusive of the Company's $125 million partial redemption of its Senior Notes on March 15, 2023, Target has reduced total cumulative debt by more than $350 million since 2020. 

These accomplishments have substantially de-risked Target's capital structure, increased the intrinsic value of the Company, and established a foundation to continue accelerating value creation.    

About Target Hospitality

Target Hospitality is one of North America's largest providers of vertically integrated modular accommodations and value-added hospitality services in the United States. Target builds, owns and operates a customized and growing network of communities for a range of end users through a full suite of value-added solutions including premium food service management, concierge, laundry, logistics, security and recreational facilities services.

Investor Contact
Mark Schuck
(832) 702 – 8009
ir@targethospitality.com

 

 

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SOURCE Target Hospitality

FAQ

What credit rating did Target Hospitality receive from S&P in April 2023?

Target Hospitality received a credit rating upgrade to B+ from S&P Global Ratings in April 2023.

How much has Target Hospitality reduced its total debt since 2020?

Target Hospitality has reduced its total debt by over $350 million since 2020.

What major contract is Target Hospitality pursuing since July 2022?

Target Hospitality is pursuing a multi-year contract for the Expanded Humanitarian Community.

When did Target Hospitality complete a partial redemption of its Senior Notes?

Target Hospitality completed a $125 million partial redemption of its Senior Notes on March 15, 2023.