Fitch assigns El Corte Ingles' planned new notes 'BBB-(EXP)'
What: Fitch assigns BBB-(EXP) rating to El Corte Inglés's planned EUR 500 million senior unsecured notes, maintaining positive outlook based on strong deleveraging and improved margins.
Why it is important: The rating action validates El Corte Inglés's successful transformation strategy, combining operational improvements with financial discipline to strengthen its market position despite retail sector challenges. Fitch Ratings has assigned a BBB-(EXP) rating to El Corte Inglés's new EUR 500 million eight-year senior unsecured notes, aligning with the company's existing debt rating.
The planned issuance will address upcoming maturities, including a EUR 420 million syndicated Term Loan due in March 2026. The Positive Outlook reflects the company's successful deleveraging efforts, with EBITDAR net leverage expected to trend below 2.0x. The company demonstrated solid business performance in FY25, achieving 4.3% like-for-like revenue growth and a 70bp improvement in EBITDA margin to 7.4%. While profitability remains below sector averages, this is partly offset by the company's diverse business mix and significant real estate portfolio, valued at EUR 15.5 billion in 2024. The rating also acknowledges El Corte Inglés's dominant market position in Spain and its strategic focus on strengthening core retail operations through digital transformation and store investments.
IADS Notes: El Corte Inglés's improved credit profile reflects its comprehensive transformation strategy. As reported in June 2025, the company achieved EUR 16,675 million in Total Transaction Revenue with 4.3% like-for-like growth, while EBITDA reached EUR 1,209 million, representing an 11.9% increase. This performance follows significant strategic initiatives, including a EUR 428 million investment in upgrading 25 locations announced in February 2025, and the creation of a dedicated Transformation Office under CEO Gastón Bottazzini in March 2025. The company's focus on operational efficiency and digital innovation, developed in partnership with McKinsey since October 2024, has yielded tangible results, with improved margins and strengthened market position, validating its strategy of balancing traditional retail strengths with modern retail capabilities.
