S&P: Mattamy view to stable

Standard & Poor’s said it revised the outlook on Mattamy Group Corp. to stable from negative.

The agency also said it affirmed the company’s BB corporate credit rating and BB rating on its senior unsecured notes.

The recovery rating on the notes is 3, indicating 50% to 70% expected default recovery.

The outlook revision was largely driven by the improvement in the company’s credit measures, which are stronger than previously forecasted, S&P said.

After the company announced the acquisition of Monarch Homes in December 2014, the agency said it projected the company to end its fiscal 2015 with adjusted debt-to-EBITDA of between 4.5x and 5x.

But after experiencing more favorable sales-price appreciation and better gross margins from both its land and homebuilding operations, the company finished its fiscal year at 3.9x adjusted debt-to-EBITDA, S&P said.

The company is expected to continue increasing community count and expanding its platform in the United States in 2016, in addition to growth in its Canadian operations, the agency added.

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