Research Update: Veregy Intermediate Inc. Outlook Revised To Positive On Deleveraging; Ratings Affirmed

Veregy Intermediate Inc., a Phoenix based provider of energy efficiency solutions, has outperformed our expectations with S&P Global Ratings-adjusted debt to EBITDA declining below 5x as of June 30, 2024. We expect leverage will remain below 5x and free operating cash flow (FOCF) generation will improve to above 5% as Veregy works through its large project backlog and continues its expansion in the California and Texas markets. Therefore, we revised our outlook on Veregy to positive from stable and affirmed our 'B-' issuer credit rating. The positive outlook reflects our view that Veregy's leverage will remain below 5x while continuing to improve FOCF to debt above 5% over the next 12 months. The positive outlook reflects our expectation Veregy will

...- Veregy Intermediate Inc., a Phoenix based provider of energy efficiency solutions, has outperformed our expectations with S&P Global Ratings-adjusted debt to EBITDA declining below 5x as of June 30, 2024. - We expect leverage will remain below 5x and free operating cash flow (FOCF) generation will improve to above 5% as Veregy works through its large project backlog and continues its expansion in the California and Texas markets. - Therefore, we revised our outlook on Veregy to positive from stable and affirmed our 'B-' issuer credit rating. - The positive outlook reflects our view that Veregy's leverage will remain below 5x while continuing to improve FOCF to debt above 5% over the next 12 months....

Research Update