S&P turns thyssenkrupp view to stable

S&P said it changed its outlook on thyssenkrupp AG (tk) to stable from negative and affirmed the BB- ratings on the company and its debt.

“Although tk's FOCF fell short due to higher inventories, its significantly improved operating performance quells downside risks. tk's credit metrics have made a stronger-than-expected comeback in FY2021 from the Covid-19-related setbacks of 2020. The company reported an S&P Global Ratings-adjusted EBITDA margin of 4.4 %.

The company also boosted its revenue by 17.5% compared with a forecasted 10.5%-11.5% growth range.

“The solid recovery was mainly driven by the dynamic macroeconomic environment. Market conditions for all segments were better than expected, with higher steel prices, increased demand for truck components, and a thriving wind energy sector, particularly in China,” S&P said.

Healthy conditions in the steel market should help tk’s cash flow over the next 12 months, the agency said.

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