Fitch raises Continental IDR, debt to BBB+

Fitch Ratings said it upgraded Continental AG's long-term issuer default rating and its long-term senior unsecured debt to BBB+ from BBB and affirmed the short-term issuer default rating at F2.

The agency also upgraded the long-term senior unsecured notes issued by Conti-Gummi Finance BV and Continental Rubber of America Corp. to BBB+ from BBB.

The outlook on Continental's long-term issuer default rating is stable.

Fitch said the upgrade reflects its expectation that Continental's business and financial profile will continue to strengthen, underpinned by the group's solid performance in recent years.

The agency expects continued revenue growth due to both a strong European auto market and market share gains, supporting ongoing operating margins of over 10%.

Fitch expects funds from operations (FFO) and cash from operations (CFO) margins to remain in line with expectations for a BBB+ rating in the foreseeable future. It said it forecasts FFO-adjusted net leverage to decrease below 1 time by end-2018 despite further use of cash on acquisitions.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.