Moody’s Ratings (Moody’s), one of the world’s leading credit rating agencies, has for the first time assigned a Ba3 Corporate Family Rating (CFR) to Pegasus Airlines Inc., Turkey’s leading low-cost carrier. In addition, the USD 500 million senior unsecured notes issued in September 2024 and maturing in 2031 received a Ba3-PD probability of default rating and a Ba3 instrument rating. The outlook for the rating was determined as “stable.”
Strong Market Position and Strategic Geographical Advantage
Moody’s highlighted that the rating assigned to Pegasus Airlines reflects the company’s strong and expanding market position as Turkey’s leading low-cost airline. The assessment emphasised its cost-efficient business model, modern and fuel-efficient fleet, and Turkey’s strategic geographical location as key factors.
It was noted that in the first half of 2025, Pegasus accounted for approximately 30% of Turkey’s domestic passenger traffic and 20% of international passenger traffic, while its dominant position at Istanbul Sabiha Gökçen Airport was identified as a significant factor supporting its strong market share.
Investments and Fleet Expansion Strategy
Pegasus Airlines plans to rapidly expand its fleet to meet rising international demand. The airline expects the delivery of 49 A321neo aircraft between 2025 and 2029, and has entered into an agreement for 200 Boeing 737 MAX 10 aircraft, including 100 firm orders, scheduled for delivery between 2028 and 2034.
As of June 2025, 86% of Pegasus’s fleet consists of new-generation, fuel-efficient aircraft. This fleet transformation is expected to create long-term value in terms of the company’s sustainability goals and operational efficiency.
Financial Discipline and Strong Liquidity
Moody’s report underlined Pegasus’s strong cost discipline, operational efficiency, and prudent financial policies. The company maintains a healthy liquidity profile with €849 million in cash reserves and approximately €1.1 billion in annual positive operating cash flow.
It was also noted that Pegasus does not plan to distribute dividends over the next two to three years, with generated cash flow to be channelled towards growth and fleet investments.
ESG and Corporate Governance Focus
Moody’s acknowledged that while Pegasus is exposed to environmental and social risks, its efforts in line with carbon transition and sustainability goals help mitigate long-term credit risks.
The company’s publicly traded structure and transparent corporate governance were also evaluated as positive factors in terms of governance.
Stable Outlook: Expectation of Consistent Growth
Moody’s stated that the stable outlook reflects expectations that Pegasus will deliver consistent operational performance and generate positive free cash flow over the next 12–18 months.
Pegasus Airlines’ rating currently stands at Ba3, which is the same level as the sovereign rating of the Republic of Turkey.
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