Moody’s ups Finmeccanica to stable

Moody's Investors Service said it affirmed its ratings for Finmeccanica SpA and wholly owned U.S. subsidiary Meccanica Holdings USA Inc., including the Ba1 senior unsecured debt ratings, and revised the outlook to stable from negative.

"The rating affirmation reflects our expectation that the company will continue to evidence modest improvements in profitability and cash flow measures driven by ongoing restructuring initiatives and balance sheet strengthening following the recent debt tender and permanent repayment ahead of forthcoming non-core asset divestitures," Russell Solomon, Moody’s senior vice president and lead analyst for Finmeccanica, said in a news release.

"In addition to the assumed successful completion of the transportation assets sale to Hitachi later this year, stabilization of the rating outlook explicitly incorporates our expectation that Finmeccanica will maintain sufficient liquidity to fully accommodate its normal course business seasonality and associated working capital volatility, particularly during the multi-year period in which its free cash flow generating capability is restored to more acceptable levels for the rating category."

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