Moody’s raises Dometic rating, changes view to stable

Moody's Investors Service said it upgraded the corporate family and probability of default ratings for Dometic Group AB to Ba2 from Ba3 and to Ba2-PD from Ba3-PD. The agency also raised the senior unsecured euro medium-term notes rating to Ba2 from Ba3.

“The upgrade to Ba2 reflects the company's ability to sustain high profitability and a strong free cash flow despite a significant contraction in the U.S. recreational vehicle (RV) market over the last twelve months, partly owing to the company's efforts in the last years to decrease exposure to that market,” said Daniel Harlid, Moody’s lead analyst for Dometic, in a press release.

“At the same time, the high cash balance reflects the company's ambition to be prepared for smaller bolt on acquisitions that further brings down RV exposure and could lead to an increase in EBITDA over time.”

Moody’s revised its outlook for Dometic to stable from positive. The agency said it projects stable EBITA margins of 14%-15% on a Moody’s-adjusted basis over the next 12-18 months.

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