S&P shifts Perstorp view to stable

S&P said it revised Perstorp’s outlook to stable from negative and affirmed the B- ratings on the company and its term loan. The 4 recovery rating, indicating a recovery of about 45% in default, is unchanged.

“Strong demand and tight supply condition on some of Perstorp's products will lead to better-than-anticipated earnings, which underpins our revision of the outlook. Perstorp reported stronger first-nine-months of 2021 performance, with revenue up by 40% year on year to SEK 9.7 billion and EBITDA more than doubled to more than SEK 1.8 billion (compared with SEK 871 million last year), thanks to strong demand in all regions, robust price increases to protect margins, and tight supply conditions for some of Perstorp's products, particularly in the engineered fluids segment, which has led to unit margin improvements,” S&P said in a press release.

The agency said it forecasts neutral to slightly negative free operating cash flow in 2021 and 2022 before turning positive to about SEK 260 million in 2023.

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