S&P lowers LSB view to stable

Standard & Poor’s said it affirmed the B+ corporate credit rating on LSB Industries Inc. and revised the outlook to stable from positive.

The agency also said it affirmed the B+ rating on the company’s senior secured notes.

The outlook revision reflects a view that the company will not likely achieve credit measures over the next year considered to be consistent with a significant financial risk profile, S&P said.

Despite benign industry conditions, the company’s earnings for 2014 were hurt by plant shutdowns, the agency said, and LSB did not make as full and sustainable of a recovery from these operational problems as previously expected.

Despite weaker expectations for 2015 as the company ramps up to bring its El Dorado ammonia expansion online, S&P said it expects its debt-to-EBITDA ratio to be less than 5x over the next year or so.

The expansion facility nearly doubles ammonia capacity and the agency said it assumes a consequent boost to EBITDA in 2016.

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