Moody's ups Metso outlook to positive

Moody's Investors Service said it changed the outlook for the Ba1 senior unsecured and issuer ratings of Metso Corp. to positive from stable.

The change in outlook reflects Moody's expectation that the 2005 improvements in operating profitability, cash flow, debt reduction and cost reductions will prove sustainable and that the improvements are supported by a good demand in the minerals business and better cost competitiveness in the paper machinery activities.

With faster-than-expected revenue growth in minerals, management will now need to ensure control over working capital and to strengthen capital investment at a measured pace in order to continue generating significant free cash flows, the agency said.

The strengthened cash flow and disposal proceeds have contributed to a reduction of gross adjusted debt to about €1.3 billion from €1.8 billion at the year end 2003.

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