Moody's changes WPP outlook to stable

Moody's Investors Service said it changed to stable from negative the outlook on the senior unsecured ratings at the subsidiaries of WPP plc and also assigned a Baa2 issuer rating to WPP.

Concurrently, Moody's affirmed the Baa2 guaranteed senior unsecured debt ratings of WPP's guaranteed subsidiaries WPP Finance 2013, WPP Finance 2016, WPP Finance 2017, WPP Finance 2010, WPP Finance SA and WPP Finance Deutschland GmbH.

"The change of rating outlook from negative to stable reflects the better-than-expected operational performance of WPP during the 2020 coronavirus crisis, particularly on cash generation supported by its timely cost control measures as well as its proactive liquidity management,” said Gunjan Dixit, a Moody's vice president, senior credit officer and lead analyst for WPP, in a press release.

"We expect WPP to achieve mid-single digit growth in organic net sales with a reported headline operating margin of 13.5%-14.0% in 2021, which should result in healthy credit metrics in line with the perimeters defined for its Baa2 rating," added Dixit.

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