Research Update: NMHG Holding Co. Outlook Revised to Negative From Positive; Higher Costs Cited

On Nov. 5, 2004, Standard&Poor's Ratings Services affirmed its ratings, including its 'BB-' corporate credit rating, on Portland, Ore.-based NMHG Holding Co. At the same time, the outlook on the forklift truck manufacturer was revised to negative from positive. At Sept. 30, 2004, NMHG had approximately $437 million in debt outstanding. The outlook revision reflects our increased concern that higher-than-expected raw material and manufacturing costs will continue to negatively affect NMHG's operating margins, constraining the credit profile in the near term, despite strong demand for its forklift products. As such, debt leverage, as measured by total debt to EBITDA, may be weaker than our expectations at the current rating level. The speculative-grade ratings on NMHG reflect an aggressive

...On Nov. 5, 2004, Standard & Poor's Ratings Services affirmed its ratings, including its '##-' corporate credit rating, on Portland, Ore.-based NMHG Holding Co. At the same time, the outlook on the forklift truck manufacturer was revised to negative from positive. At Sept. 30, 2004, NMHG had approximately $437 million in debt outstanding. The outlook revision reflects our increased concern that higher-than-expected raw material and manufacturing costs will continue to negatively affect NMHG's operating margins, constraining the credit profile in the near term, despite strong demand for its forklift products. As such, debt leverage, as measured by total debt to EBITDA, may be weaker than our expectations at the current rating level. The speculative-grade ratings on NMHG reflect an aggressive financial profile, fair liquidity, and leading positions within cyclical and volatile markets. NMHG competes in the global forklift truck market, which is characterized as moderate in size, somewhat consolidated,...

Research Update