Research Update: Reworld Holding Corp. 'B+' Issuer Credit Rating Affirmed On Improving Earnings Due To Waste Segment Growth

We anticipate Reworld Holding Corp. (Reworld) will modestly improve its adjusted EBITDA on the back of increasing its waste segment revenues by 3%-10% annually through 2026 due to higher pricing and volumes. The company's contractual structure for the energy segment is largely fixed at about 85%-90% of expected energy generation through 2028, reducing earnings volatility while limiting upside from higher power prices. We also note that capital expenditures (capex) remain elevated as management seeks to improvement boiler availability and earnings. This will limit cash flows available for any meaningful deleveraging. S&P Global Ratings affirmed its 'B+' issuer credit rating on Reworld, its 'BB' issue-level rating on the company's senior secured debt, and its 'B' issue-level rating on Reworld's senior unsecured

...- We anticipate Reworld Holding Corp. (Reworld) will modestly improve its adjusted EBITDA on the back of increasing its waste segment revenues by 3%-10% annually through 2026 due to higher pricing and volumes. The company's contractual structure for the energy segment is largely fixed at about 85%-90% of expected energy generation through 2028, reducing earnings volatility while limiting upside from higher power prices. We also note that capital expenditures (capex) remain elevated as management seeks to improvement boiler availability and earnings. This will limit cash flows available for any meaningful deleveraging. - S&P Global Ratings affirmed its 'B+' issuer credit rating on Reworld, its '##' issue-level rating on the company's senior secured debt, and its 'B' issue-level rating on Reworld's senior unsecured debt. The '1' recovery rating on the secured debt and '5' recovery rating on the unsecured debt are unchanged. - The stable outlook reflects our expectation that Reworld will sustain...

Research Update