Moody's alters Kleopatra view to negative

Moody's Investors Service said it changed the outlooks for Kleopatra Holdings 2 SCA (Klockner Pentaplast) and Kleopatra Finco Sarl to negative from stable.

Concurrently, the agency affirmed Kleopatra Holdings’ B3 corporate family rating and the B2 ratings on the senior secured first-lien revolving credit facility, the senior secured first-lien term loan, and the guaranteed senior secured notes due 2026 issued by Kleopatra Finco. Moody’s also affirmed the Caa2 instrument rating on the guaranteed senior notes due 2026 issued by Kleopatra Holdings 2.

“Today's rating action reflects material deterioration in profitability over the course of the first three quarters of 2021 as measured by the EBITDA margin declining to 13.7% for the 12 months ending September 2021 from 15.5% in 2020 (as adjusted by Moody's). This reduction in EBITDA resulted from lags in passing through escalating costs of raw materials and other variable expenses such as energy, transportation, labor and packaging,” Moody’s said in a press release.

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