Research Update: Nufarm Upgraded To 'BB' On New Capital Management Framework And Strengthened Balance Sheet; Outlook Stable

Nufarm Ltd.'s continued improvement in its working capital management and strong trading performance across all operating regions, particularly Europe, have strengthened the group's credit metrics. The global maker of crop protection products had an S&P adjusted debt-to-EBITDA ratio of 2.3x for the year ended Sept. 30, 2021, below our upward trigger of 3.5x. We view the introduction of the group's new capital management framework, which prioritizes balance sheet strength and free cash flow ahead of shareholder returns, as credit positive. We expect improved free operating cash flow generation and Nufarm's capital management framework to support sustainably reduced leverage over the forecast period. On Nov. 23, 2021, S&P Global Ratings raised its long-term issuer credit rating on Nufarm to 'BB' from

...- Nufarm Ltd.'s continued improvement in its working capital management and strong trading performance across all operating regions, particularly Europe, have strengthened the group's credit metrics. The global maker of crop protection products had an S&P adjusted debt-to-EBITDA ratio of 2.3x for the year ended Sept. 30, 2021, below our upward trigger of 3.5x. - We view the introduction of the group's new capital management framework, which prioritizes balance sheet strength and free cash flow ahead of shareholder returns, as credit positive. We expect improved free operating cash flow generation and Nufarm's capital management framework to support sustainably reduced leverage over the forecast period. - On Nov. 23, 2021, S&P Global Ratings raised its long-term issuer credit rating on Nufarm to '##' from '##-'. At the same time, we raised the long-term issue ratings on Nufarm's A$490 million senior secured bank facility to '###-' from '##+' (recovery rating of '1'), its US$475 million senior...

Research Update