Fitch turns Galderma outlook to stable

Fitch Ratings said it revised Sunshine Luxembourg VII Sarl's (Galderma) outlook to stable from negative while affirming the company's long-term issuer default rating at B, and senior secured rating at B+ with an RR3 recovery rating.

“The outlook revision reflects receding execution risks following demonstrated strong resilience of sales and profits, as well as effective management of higher input costs. We expect this to support deleveraging towards levels that are more consistent with the rating. Galderma's funds from operations (FFO) leverage declined to 8.2x at end-2021, lower than our previous forecast, from 10.7x at end-2020, and we believe its consistent profit growth from 2022 and cash flow generation from 2023 will enable its reduction to below 7.5x by 2023,” Fitch said in a press release.

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