S&P turns Shawcor outlook to positive

S&P said it revised its outlook for Shawcor Ltd. (Mattr Infratech) to positive from stable and affirmed its BB- issuer rating.

The positive outlook mirrors an expectation that Mattr will produce credit metrics over the next couple of years that will be considered strong for the rating, the agency said.

“We expect Mattr will generate an adjusted debt-to-EBITDA ratio below our 2x upgrade trigger over the next few years, including about 1.7x in 2024 and about 1.3x in 2025 (down from about 2.4x at the end of 2022).

“Mattr has significantly reduced its debt leverage during 2023 following the repayments made under its credit facility, earnings growth in its continuing operations (connection technologies and composite technologies segments) and about C$225 million of cash proceeds received during the fourth quarter from the completed sale of its pipe coating business. Our forecast assumes annual organic revenue growth (%) from continuing operations in the mid-to high-teens area and improved profitability over the next few years,” S&P said in a press release.

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