Moody's downgrades Aludyne

Moody's Investors Service said it downgraded Aludyne, Inc.’s ratings, including the corporate family rating to B3 from B2, the probability of default rating to B3-PD from B2-PD and the senior secured bank credit facility rating to Caa1 from B3.

“The downgrade reflects Aludyne's significantly lower earnings and weakened liquidity as a result of an uneven and disrupted recovery in US light vehicle production during 2021. Moody's expects U.S. auto sales to increase about 6% in 2022 and for production schedules to become more steady as the availability of semiconductor chips for auto manufacturers improves. Higher volumes will improve Aludyne's cost absorption, but Moody's expects the company's EBITA margin to remain compressed at about 3% and for free cash flow to remain slightly negative in 2022,” the agency said in a press release.

The outlook is stable.

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