S&P turns Carpenter view to negative

S&P said it changed Carpenter Technology Corp.’s outlook to negative from stable, but affirmed its BB+ ratings. The 3 (50%-70%; rounded estimate: 65%) recovery rating on its senior unsecured notes is unchanged.

“In our view, the pace of recovery in Carpenter's profitability and credit metrics remains uncertain given the expected weak performance in its aerospace business in fiscal 2022. Carpenter's heavy reliance on the aerospace industry (which accounted for 56% of Carpenter's net revenues in 2019) resulted in material operational performance disruption and deteriorating credit metrics over the last two fiscal years (ended June 30),” S&P said in a press release.

The agency warned it could lower the rating over the next 12 months if Carpenter does not improve business performance.

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