OHLA ratings affirmed at B- as Fitch cites stable outlook and liquidity constraints

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OHLA ratings affirmed, stable outlook

Highlights

Fitch affirms Obrascon Huarte Lain, S.A. and OHL Operaciones, S.A.U. at B- with a stable outlook, citing limited liquidity and improving leverage profile.
OHLA's liquidity at end-June 2026 remains constrained, with over half of EUR581 million cash held in joint ventures and no committed credit lines.
Fitch projects EBITDA margin rising to 4.6% in 2026, EBITDA gross leverage dropping to 2.7–3.2 times, but litigation continues to threaten cash flow visibility.

Fitch assessment of liquidity and credit profile

As reported by Fitch Ratings, Obrascon Huarte Lain, S.A. and its subsidiary OHL Operaciones, S.A.U. retain their B- Long-Term Issuer Default Ratings, while OHL Operaciones' senior secured notes stay at B with a Recovery Rating of RR3.

Fitch says the ratings reflect expectations that OHLA will maintain limited liquidity headroom alongside a sound leverage profile, supported by improving operating performance. At the same time, the agency says the group remains exposed to working-capital volatility and potential one-off payments linked to legal claims because its financial flexibility is still constrained.

At end-June 2026, OHLA's liquidity provides only limited room for unexpected cash outflows. Fitch notes the group has no committed credit lines, and that more than half of the EUR581 million cash reported at 30 June 2026 is held in joint ventures where the funds may not be readily available.

Fitch adds that liquidity remains central to OHLA's access to bank performance guarantees on current terms, which are important for engineering and construction contracts. That risk is partly offset by the group's long-dated debt maturity profile and its record of shareholder support.

Profitability gains offset by legal and cash flow risks

Fitch expects OHLA's EBITDA margin, as defined by the agency, to rise to 4.6% in 2026, excluding the one-off effect of recent disputes. That compares with 3.5% in 2025 and about 3.1% to 3.2% in 2023 and 2024, indicating a gradual improvement in operating profitability.

The agency forecasts neutral to positive free cash flow over 2026 to 2029, helped by a solid order backlog and modest margin improvement. It also expects EBITDA gross leverage to remain at 2.7 times to 3.2 times in 2026 to 2029, down from 3.5 times at end-2025 following the recapitalisation completed in February 2025.

Even so, unresolved litigation continues to weigh on free cash flow visibility. Fitch says OHLA has settled several legacy disputes, but significant liabilities tied to the Sidra project and other cases still pose risks.

For future rating direction, Fitch identifies weakening liquidity, negative free cash flow and higher leverage as negative factors. Improved liquidity, sustained positive free cash flow and leverage maintained within thresholds could support positive rating momentum.

Fitch’s Rating Watch Negative on Inwit highlighted heightened uncertainty around the company’s credit profile amid shifting telecom infrastructure sector conditions. Our earlier article noted that Fitch planned to reassess the rating once Inwit provided clearer guidance on its financial outlook and strategic plans, with investors watching closely for developments that could affect financial stability.

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