Research Update: Ecolab Inc. Ratings Affirmed On $500 Million Share Buyback Program; Outlook Stable

Ecolab Inc. recently announced its intention to purchase $500 million of its own shares in 2022. Although we believe this action is a slight credit negative, we expect 2022-2023 improvements in Ecolab's operating performance will strengthen credit measures that weakened following the 2021 Purolite acquisition. On a weighted-average basis, we expect debt leverage ratios will remain in line with our expectations at the rating. Therefore, we affirmed our 'A-' issuer credit rating and stable outlook. The stable outlook reflects our belief that weighted-average credit measures have troughed in 2021 and should begin to show gradual improvement in the second half of 2022 and beyond through growth of its EBITDA and margins organically and with the integration of its recent acquisition

...- Ecolab Inc. recently announced its intention to purchase $500 million of its own shares in 2022. - Although we believe this action is a slight credit negative, we expect 2022-2023 improvements in Ecolab's operating performance will strengthen credit measures that weakened following the 2021 Purolite acquisition. On a weighted-average basis, we expect debt leverage ratios will remain in line with our expectations at the rating. - Therefore, we affirmed our 'A-' issuer credit rating and stable outlook. - The stable outlook reflects our belief that weighted-average credit measures have troughed in 2021 and should begin to show gradual improvement in the second half of 2022 and beyond through growth of its EBITDA and margins organically and with the integration of its recent acquisition of Purolite. We continue to expect that on a weighted-average considering five years, the key ratio of funds from operations (FFO) to debt will be at or above 30% and debt to EBITDA will be at or below 3x....

Research Update