S&P revises Engineering view to negative

S&P said it revised its outlook for Centurion Newco SpA (Engineering) to negative from stable and lowered the rounded recovery estimate on its senior secured notes to 50% from 55%. The recovery rating on the notes remains at 3.

The agency also affirmed the B- ratings on Engineering and its senior secured notes.

In a press release, S&P noted that Engineering’s, “very high S&P Global Ratings-adjusted leverage for full-year 2023, sustained high exceptional costs, and negative free cash flow before factoring raise doubts about the trajectory of key credit parameters, eclipsing the steady growth of the company's reported revenue and EBITDA.”

The agency warned a downgrade is possible if Engineering’s quarterly results suggest exceptional costs or adjusted leverage may not come down significantly if free operating cash flow does not turn positive before the effects of factoring, or if liquidity weakens.

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