Research Update: LafargeHolcim Ltd. Outlook Revised To Positive On Strong Performance And Cash Generation; 'BBB/A-2' Ratings Affirmed

Switzerland-headquartered building materials manufacturer LafargeHolcim Ltd. has accumulated healthy rating headroom thanks to resilient operating performance in 2020, despite the global recession resulting from the COVID-19 pandemic. We anticipate that the company will retain this headroom in 2021-2022, even when factoring in the Swiss franc (CHF) 3.1 billion acquisition of Firestone Building Products that we anticipate will close in spring 2021. We now foresee that LafargeHolcim will post S&P Global Ratings-adjusted funds from operations (FFO) to debt of 32%-33% in 2021 and about 35% in 2022. This compares with the 30% in 2021 and more than 33% in 2022 that we previously forecasted in January 2021, when the company announced its acquisition of Firestone. We are revising our outlook on

... LafargeHolcim Ltd. has accumulated healthy rating headroom thanks to resilient operating performance in 2020, despite the global recession resulting from the COVID-19 pandemic. - We anticipate that the company will retain this headroom in 2021-2022, even when factoring in the Swiss franc (CHF) 3.1 billion acquisition of Firestone Building Products that we anticipate will close in spring 2021. - We now foresee that LafargeHolcim will post S&P Global Ratings-adjusted funds from operations (FFO) to debt of 32%-33% in 2021 and about 35% in 2022. This compares with the 30% in 2021 and more than 33% in 2022 that we previously forecasted in January 2021, when the company announced its acquisition of Firestone. - We are revising our outlook on LafargeHolcim to positive from stable, and affirming our '###/A-2' long- and short-term issuer credit ratings on the company. - The positive outlook reflects that we may raise the ratings on LafargeHolcim...

Research Update