Moody's upgrades UPM-Kymmene

Moody's Investors Service said it upgraded the long term issuer rating of UPM-Kymmene to Baa1 from Baa2. Concurrently, Moody's upgraded the senior unsecured bond rating of the bonds issued by UPM to Baa1 from Baa2. The outlook on the ratings has changed to stable from positive.

“Today's upgrade reflects UPM's continued track record of solid operating performance leading to further deleveraging, supported by our expectation of continued financial discipline that will enable UPM to sustain credit metrics that are commensurate with a Baa1 rating even when considering investments into its new pulp mill in Uruguay and the biochemicals business,” said Dirk Steinicke Moody's lead analyst for UPM.

The upgrade reflects UPM's ongoing solid operating performance through 2019, despite the ongoing structural decline in demand for graphics grade paper coupled with significantly lower pulp prices. The group's profitability remained on a good level with its EBITDA margin, as adjusted by Moody's, at 18.1% for 2019. Solid cash flow generation, helped by tight working capital management supported the group's strong balance sheet with Moody's-adjusted retained cash flow/debt of 46% and Moody's adjusted debt/EBITDA at 1x.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.