S&P ups Russel Metals

S&P said it upgraded its ratings for Russel Metals Inc. and its senior unsecured notes to BB+ from BB. The 4 recovery rating for the notes is unchanged.

“The upgrade mainly reflects the significant improvement in Russel's operating results and corresponding cushion to manage future protracted steel price downturns. We believe Russel can maintain credit measures that are strong for the rating over the next couple of years, following 2020 and 2021 operating results that were much stronger than our previous assumptions,” the agency said in a press release.

S&P said it forecasts Russel’s adjusted debt-to-EBITDA ratio will be below 1x in 2021, mostly on steeply higher earnings and cash flow linked to an unprecedented increase in steel prices.

The outlook is stable.

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