Bormioli Pharma SpA

The stable outlook reflects our expectation that Bormioli Pharma will continue to capitalize on its solid client relationships and leading niche positions. We expect minimal, but positive free operating cash flow (FOCF) for this year with S&P Global Ratings-adjusted debt to EBITDA of 6.3x in December 2021. We could lower our rating if Bormioli Pharma experienced unexpected customer losses or operating setbacks due to furnace shutdowns, or raw material price increases that it was not able to pass on to customers. This could undermine the company's liquidity position in the medium term. We could also lower the rating if the company's financial policy became more aggressive (that is, if it made a large payment to shareholders or debt-funded acquisition), preventing

...The COVID-19 pandemic has had a limited effect on Bormioli Pharma SpA's performance. In 2020, the group faced higher delivery costs as a result of temporary mobility restrictions and tighter border controls imposed in light of the pandemic. Demand remained robust, except for packaging for cosmetics and nutraceutical products (about 15% of sales). S&P Global Ratings believes that demand for these products will gradually recover in 2021. Bormioli Pharma is likely to continue expanding its operations via acquisitions. Last year Bormioli Pharma acquired Italian closures producer GCL Pharma (now Bormioli Pharma Vasto), which produces plastic and rubber stoppers, and aluminum closures for pharmaceutical products. It generates annual revenue and EBITDA of about 8 million and 0.8 million, respectively. Bormioli Pharma also acquired Germany-based ISO Gesellschaft, which produces tubular glass vials (largely used in the packaging of vaccines). ISO Gesellschaft generates revenue of about 7 million...

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