S&P: Suedzucker to positive

S&P said it revised the outlook on Suedzucker AG’s positive from stable.

The agency also said it affirmed the long-term corporate credit ratings at BBB- and short-term issuer default rating at A-3.

S&P also said it affirmed the ratings on Suedzucker's senior unsecured debt instruments at BBB- and affirmed its A-3 short-term issue rating on the commercial-paper program.

The agency also said it affirmed the B+ ratings on the company’s subordinated hybrid bonds.

Suedzucker should generate higher earnings and improve its credit metrics over the next two years thanks to a rebound in European Union quota sugar prices from their currently very low levels, S&P said.

The current low energy costs and the company’s measures to improve its operating cost structure and decrease capital expenditures should support cash-flow generation, the agency said.

Suedzucker's credit metrics already have improved in the financial year 2015-2016, S&P said.

The losses incurred by the sugar operations were offset by a very strong rebound in earnings from ethanol thanks to the high European market prices last year and by a strong working capital inflow, particularly from lower sugar inventories, the agency said.

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