S&P turns U.S. Silica view to positive

S&P said it affirmed U.S. Silica Co.’s B- ratings, removed the ratings from CreditWatch with developing implications, where they were placed on Oct. 14 and assigned a positive outlook.

Following a strategic review, U.S. Silica decided to keep its industry and specialty products segment, which led to the removal of the CreditWatch, the agency said.

“We expect U.S. Silica's leverage will improve, fueled by stronger earnings and debt reduction. We forecast the company's adjusted EBITDA at $250 million-$300 million in fiscal 2022, which compares favorably with $226 million generated in fiscal 2021. We anticipate U.S. Silica will sell 17 million-19 million metric tons in 2022 following strong demand for frac sand in the oil and gas industry,” S&P said in a press release.

The improved outlook reflects the potential for higher ratings within the next 12 months if U.S. Silica can keep its adjusted leverage under 5x.

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