Moody’s shifts Ferro view to negative

Moody’s Investors Service said it changed Ferro Corp.’s outlook to negative from stable, but confirmed Ferro’s Ba3 corporate family rating, Ba3-PD probability of default rating and other instrument ratings.

“The negative outlook reflects Ferro’s weak operating results and elevated debt leverage as a result of the slowing economy, customer destocking and foreign currency depreciation. We expect its financial performance will remain subdued given the large exposure to the slowing European and Asian economies and the lack of demand visibility. Management plan to slow business acquisitions and share repurchases will help direct cash flow to repay debt, but debt leverage will remain high relative to its Ba3 rating requirement in the next 12 to 18 months,” said Jiming Zou, a Moody’s senior analyst and vice president.

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