S&P: Kennametal view negative

Standard & Poor’s said itrevised its outlook on Kennametal Inc. to negative from stable.

At the same time, S&P affirmed all of its ratings on the company, including its BBB corporate credit rating.

“The outlook revision reflects our view that Kennametal's recent operational weaknesses – which include a challenging end-market demand environment, limited visibility regarding the magnitude and duration of the downturn in the company's performance, and the loss of market share in some of its geographies – are more severe than we had previously anticipated,” said S&P credit analyst James Siahaan, in a news release.

On Dec. 15, the company indicated that its earnings per share and cash flow for fiscal-year 2016 would likely be 30% to 60% lower than its previous guidance. S&P said it now believes that there is a one-in-three probability that the company's operational underperformance could cause its adjusted debt-to-EBITDA metric to increase beyond the 2x-3x range that the agency expects for the current rating during the next two years.

© 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.