26.09.2016, 19:51
Fitch Affirms Hillenbrand
OREANDA-NEWS. Fitch Ratings has affirmed the Long-Term Issuer Default Rating (IDR) for Hillenbrand, Inc. (HI) at 'BBB-'. Fitch has also affirmed HI's senior unsecured credit facility (revolver and term loan) and senior unsecured notes at 'BBB-'. The Rating Outlook is Stable. $637 million of debt was outstanding as of June 30, 2016. A full list of rating actions follows at the end of this release. The Rating Outlook is Stable.
The ratings reflect the cyclicality and long-term growth potential within HI's Process Equipment Group, as well as the healthy margins and cash flow from the company's mature Batesville segment. The ratings further reflect the current weakness in HI's business and its elevated financial leverage following two acquisitions completed in the first half of fiscal 2016 (ending Sept. 30).
The process equipment group (PEG), which accounted for 62% of revenues and 52% of EBITDA in fiscal 2015, experienced a 9.4% revenue decline in the first nine months of fiscal 2016, following a 7.6% decline in fiscal 2015 due to lower demand for equipment used in the plastics, energy and mining markets, and unfavorable foreign currency movements offset in part by the impact of acquisitions. The segment operating margin narrowed to 10.9% (before restructuring and unusual charges) in the first nine months of fiscal 2016 compared with 11.9% in the prior year period.
The ratings reflect the cyclicality and long-term growth potential within HI's Process Equipment Group, as well as the healthy margins and cash flow from the company's mature Batesville segment. The ratings further reflect the current weakness in HI's business and its elevated financial leverage following two acquisitions completed in the first half of fiscal 2016 (ending Sept. 30).
The process equipment group (PEG), which accounted for 62% of revenues and 52% of EBITDA in fiscal 2015, experienced a 9.4% revenue decline in the first nine months of fiscal 2016, following a 7.6% decline in fiscal 2015 due to lower demand for equipment used in the plastics, energy and mining markets, and unfavorable foreign currency movements offset in part by the impact of acquisitions. The segment operating margin narrowed to 10.9% (before restructuring and unusual charges) in the first nine months of fiscal 2016 compared with 11.9% in the prior year period.
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