Bulletin: Recovery In 2021 Still Key To Faurecia?s Credit Quality Despite Updated Company Guidance

PARIS (S&P Global Ratings) Oct. 23, 2020--S&P Global Ratings said today that French auto supplier Faurecia SE's positively revised guidance for the second half of 2020 won't alleviate the strain on the company's credit metrics. We believe that Faurecia (BB/Stable/--) will likely report credit metrics in the higher end of our previous base-case expectations (see "French Auto Supplier Faurecia SE Downgraded To 'BB' As COVID-19 Weakens Deleveraging Prospects; Outlook Stable," published June 19, 2020, on RatingsDirect). Incorporating the company's third-quarter results, we now forecast that, in 2020, Faurecia's EBITDA margin will narrow to about 6.0% (versus our previous expectation of 4.0%-6.0%) from 8.8% in 2019, and that its funds from operations (FFO) to debt will drop to about 9.0% (versus

...October 23, 2020 PARIS (S&P Global Ratings) Oct. 23, 2020--S&P Global Ratings said today that French auto supplier Faurecia SE's positively revised guidance for the second half of 2020 won't alleviate the strain on the company's credit metrics. We believe that Faurecia (##/Stable/--) will likely report credit metrics in the higher end of our previous base-case expectations (see "French Auto Supplier Faurecia SE Downgraded To '##' As COVID-19 Weakens Deleveraging Prospects; Outlook Stable," published June 19, 2020, on RatingsDirect). Incorporating the company's third-quarter results, we now forecast that, in 2020, Faurecia's EBITDA margin will narrow to about 6.0% (versus our previous expectation of 4.0%-6.0%) from 8.8% in 2019, and that its funds from operations (FFO) to debt will drop to about 9.0% (versus 7.0%-9.0% expected previously) from 26.2% in 2019. Furthermore, we continue to forecast that the company will report negative free operating cash flow (FOCF) of 400 million-450 million...

Bulletin