S&P turns Kleopatra view to negative

S&P said it changed the outlook for Kleopatra Holdings 2 SCA to negative from stable and affirmed the B ratings on the company and its secured debt. The agency also affirmed the CCC+ rating on Kleopatra’s unsecured debt.

“The outlook revision to negative reflects heightened uncertainty around the speed of deleveraging. Because of KH2's long-term maturity structure, this includes mainly the risks associated with future weakening of the company's profitability. Profitability could suffer through limited pass-through of volatile raw materials prices and other input costs, as well as further softening of volumes in the food packaging division, as home demand declines because pandemic-related restrictions are falling away,” S&P said in a press release.

The agency said it does see the company’s profitability rebounding with a revised base case for S&P Global Ratings-adjusted EBITDA of €250 million-€270 million in 2022, and €280 million-€320 million in 2023.

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