S&P lifts Renault to positive

Standard & Poor’s said it revised the outlook on Renault SA to positive from stable.

The agency also said it affirmed the BB+ long-term and B short-term corporate credit ratings on the company.

The outlook revision reflects a view that Renault could maintain strong credit ratios in the next two years while gradually improving its profitability, S&P said.

Renault has markedly improved its financial profile in recent years, the agency said.

Between 2010 and 2013, the company’s adjusted funds from operations-to-debt ratio climbed to 61% from 31% thanks to asset disposals and earnings growth, S&P said.

Over that three-year period, the company’s adjusted debt contracted to €4.0 billion from €5.7 billion, the agency added.

Even though operations in emerging markets are currently weighing on earnings, S&P said it believes that these operations remain fundamentally supportive of Renault’s credit quality.

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