S&P changes Marfrig view to positive

S&P said it revised the outlook for Marfrig Global Foods SA to positive from stable and affirmed its BB- global scale and brAA+ national scale issue-level ratings. The agency also affirmed the 3 recovery ratings, which estimates a recovery value between 50%-70%.

Marfrig's operating performance improved given positive export profits from South America and higher spreads in North America in the second quarter of 2020. U.S. domestic meat prices skyrocketed because Marfrig's large U.S. competitors suffered production disruptions because of many Covid-19 infections, S&P said.

“The positive outlook reflects an at least one-in-three of a chance of an upgrade in the next 12 months if the company sustains its robust free cash flow generation and uses it to reduce debt and interest,” the agency said in a press release.

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