Moody's lowers Sappi Papier

Moody's Investors Service said it downgraded to Ba1 from Baa3 the backed senior unsecured debt ratings of Sappi Papier Holding GmbH (SPH), benefiting from a guarantee from its parent company, Sappi Ltd. (unrated).

The outlook is stable.

Moody's said that the downgrade of Sappi Papier Holding's backed senior unsecured rating to Ba1 considered Sappi's weak profitability and ongoing high leverage, reflecting mainly an ongoing very weak operating performance of its North American activities as well as some weakness of its European operations.

The stable outlook reflects Sappi's strong historical position in the high-quality publication paper market, the good asset quality of its European and North American paper machines which are in line with other leading industry players, as well as the expectation of some price increases on the back of both capacity adjustments and a pick-up in advertising expenditure in print media, the agency added.

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