S&P shifts USF outlook to stable

S&P said it changed its outlook for USF Holdings LLC to stable from developing and affirmed the CCC+ ratings on the issuer and its first-lien term loan. The 3 (50%-70% recovery, rounded estimate: 60%) remains unchanged.

“The company's financial performance has stabilized from the impact of Covid-19 in 2020 and the supply chain disruptions in 2021. USF recorded a large increase in revenues during the first half of 2022 compared with the prior year because of successfully launching several new automotive original equipment manufacturer (OEM) vehicle programs and a slight improvement in vehicle production levels with key automotive OEM customers,” S&P said in a press release.

The agency said it sees USF cutting its leverage to the 5.5x-6x range during 2022 and mid-4x afterwards from a high of 8x in 2021.

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