S&P lifts Kloeckner to stable

Standard & Poor's said it revised the outlook on Kloeckner & Co. SE to stable from negative.

The agency also said it affirmed the company's B+ long-term corporate credit rating, along with the B+ rating on the senior unsecured convertible bonds issued or guaranteed by Kloeckner. S&P also said it revised the recovery rating on the bonds to 3 from 4, indicating 50% to 70% expected default recovery.

The outlook revision reflects Kloeckner's profitability and credit metrics, which are expected improve in 2014 to levels considered commensurate with the current ratings.

S&P also said it expects continued modest positive free operating cash flow before acquisitions.

The anticipation of improved credit metrics is based on an expectation of improved profitability in 2014, the agency said.

But Kloeckner's business risk profile is considered weak, incorporating the company's weak competitive position, S&P said.

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