S&P revises Energizer outlook to stable

S&P said it changed its outlook for Energizer Holdings Inc. to stable from negative affirmed all its ratings on the company, including the B+ issuer credit rating, BB senior secured debt rating and B senior unsecured debt rating, the recovery ratings on the debt remain at 1 and 5, respectively. The agency also revised the rounded recovery estimate on the senior secured debt to 95% from 90%, reflecting the lower debt claims outstanding in a default scenario after partial prepayment of the term loan.

“The stable outlook reflects our expectation for generally steady sales and profit growth over the next year despite sustained high costs. We further expect the company will continue to generate satisfactory free operating cash flow (FOCF), which will be directed primarily to debt reduction instead of share repurchases and acquisitions, resulting in leverage improving to the mid-5x range over the next 12 months,” S&P said in a press release.

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