Digicel Holdings (Bermuda) Ltd has earned a more positive outlook from Moody’s Ratings after a series of steps to strengthen its financial position and governance.

Moody’s assigned Digicel a B3 corporate family rating and upgraded the outlook for Digicel and its subsidiaries to “positive” from “stable”.

The agency cited “increased visibility on the company's operating and financial strategy and improved governance practices including financial policies and experienced management and board members”.

Digicel generated $1.82 billion in revenue in 2024.

The new outlook reflects Moody’s expectation that Digicel will successfully refinance $2.3 billion in debt maturing in 2027 and maintain its [earnings before interest, taxes, depreciation, and amortisation] margin above 40 per cent.

“The positive outlook incorporates our expectation that the company will successfully refinance the debt maturing in 2027 at least twelve months in advance and that Digicel will be able to sustain its EBITDA margin above 40 per cent supported by the company's solid competitive position,” Moody’s said.

The Bermudian-incorporated company, which operates in 25 Caribbean markets, has undergone major changes since completing a restructuring in 2024.

Digicel strengthened its liquidity profile, set a medium-term leverage target of 3.25 times and installed a board where six of nine members are independent.

Moody’s highlighted Digicel’s “sound market position” and “positive free cashflow generation of $139 million” for 2024, but warned that challenges remain, especially in politically unstable countries like Haiti, which accounts for 17 per cent of revenues.

While Moody’s sees signs of progress, it stressed that refinancing the 2027 debt is critical. The agency said it could upgrade Digicel’s rating if it maintains debt levels under control and continues to generate strong cashflow.

On the other hand, failure to refinance or worsening liquidity could lead to a downgrade.