TegenBeterWetenIn schreef op 28 augustus 2020 12:56:
New York, August 27, 2020 -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of AMG Advanced Metallurgical Group N.V. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. The review did not involve a rating committee. Since 1 January 2019, Moody's practice has been to issue a press release following each periodic review to announce its completion.
This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement. For any credit ratings referenced in this publication, please see the ratings tab on the issuer/entity page on www.moodys.com
for the most updated credit rating action information and rating history.
Key rating considerations are summarized below.
AMG's B2 credit rating benefits from its good liquidity, long standing relationships with blue chip customers, strong market position as well as the geographic and end-market diversity. Critical Materials, its largest segment, operates in a market with only a few large competitors and company's products play an important role in strengthening and lightweighting as well as the reduction of carbon emissions. This will provide for a relatively steady customer demand over the longer term, especially with the growing importance of sustainability in the industry. The company is making strategic investments in its Cambridge II spent catalyst recycling plant to produce ferrovanadium (FeV) in the U.S. and the battery grade hydroxide plant in Germany which should provide earnings potential in the long term. AMG's credit profile is constrained by its small scale relative to higher rated manufacturers, its meaningful reliance on the aerospace sector that is unlikely to recover before 2023 and its rising exposure to cyclical metals that tend to exhibit a significant volatility in prices and have a significant impact on earnings and cash flow generation. AMG's leverage is expected to remain high through 2021 due to high capital spending, earnings contraction and negative free cash flow.