S&P shifts Sartorius view to negative

S&P said it revised its outlook for Sartorius AG to negative from stable and affirmed its BBB ratings on the issuer and its senior unsecured notes.

“The outlook revision reflects that Sartorius' profitability will remain weaker due to softer order intake, pushing adjusted debt to EBITDA to 5.8x in 2023. According to Sartorius' recent profit warning, soft customer demand has lasted longer than anticipated. This affected the group's results in the first nine months of 2023, where order intake fell by 27.9% at constant currencies. The group's customers built extensive safety stocks in consumables in 2022, and so the start of the reordering cycle is taking longer than anticipated,” S&P said in a press release.

S&P said it now forecasts Sartorius’ revenue to fall by 17% compared to its previous estimate of 11.8%.

However, “In our view, there is a reasonable likelihood credit metrics will improve in 2024, particularly with adjusted debt to EBITDA strengthening to 3.9x,” the agency said.

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