Moody’s revises Suedzucker to negative

Moody's Investors Service said it changed the outlook on the Baa2 long-term issuer ratings of Suedzucker AG to negative from stable.

At the same time, the agency affirmed the senior unsecured long-term issuer rating Baa2 and the short-term Prime-2 ratings of Suedzucker and Suedzucker International Finance BV.

Additionally Moody's downgraded Suedzucker International Finance’s junior subordinated rating to Ba3 from Ba2.

"We have revised the outlook on Suedzucker's Baa2 rating to negative from stable, primarily as a result of the company's ongoing weak operating performance and our expectation that the difficult trading environment in the European sugar and ethanol markets will continue to negatively affect operating performance in FY2015-16; we have also downgraded to Ba3 from Ba2 the Suedzucker International Finance B.V's junior subordinated rating reflecting the diminished headroom under a cash flow event of the hybrid instrument. If the operating performance continues to be pressured, a cash flow event in the hybrid instrument, would oblige the company to suspend the coupon payment posing an impairment risk for holders," Ernesto Bisagno, Moody's vice president, senior analyst and lead analyst for Suedzucker, said in a news release.

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