Rating agency Standard & Poor's (S&P) has published a credit research update on METRO AG, raising its outlook from negative to stable and confirming its BBB-/A-3 rating. The update is based on 20% sales growth due to inflation and better-than-anticipated volume growth in operations as well as better-than-forecast debt metrics.
"S&P Global Ratings expects that Metro AG can maintain S&P Global Ratings-adjusted leverage of well below 3.0x in fiscal 2023 despite the challenging macroeconomic environment," says the report, which also mentions the sCore growth strategy and its funding from internal cash flows. The report also acknowledges that METRO is actively managing the risk associated with its Russian business. "We understand that the sales growth incorporates moderate volume growth and is strongly supported by the high inflation in the eurozone, which reached 10.9% at Sept. 30, 2022, when Metro's fiscal year ends."