The rating on Belgium-headquartered hygienic disposables manufacturer Ontex IV S.A. (Ontex) reflects Standard & Poor's Rating Services' assessment of its financial risk profile as "highly leveraged," with fully Standard & Poor's-adjusted debt to EBITDA of about 7x for the 12 months ended Sept. 30, 2011. We classify Ontex's business risk profile as "fair," reflecting increased competition from branded players pursuing aggressive promotion and discounting strategies. The group is also exposed to volatile raw material prices, which make up about 67% of operating costs. These weaknesses are mitigated by Ontex's established position in the niche private-label market for hygienic disposable products in Europe and its good cash generation capacity. In the first nine months of 2011, Ontex's operating margins were lower...
Companies mentioned in this report are:
- Ontex IV S.A.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
This product consists of a Summary Analysis: Bi-annual (at least). An abbreviated analysis containing Standard & Poor's issuer credit ratings as of the time the article was published. The analysis includes a rating rationale - the basis on which the rating was assigned - and an outlook section if the issuer is not on CreditWatch. Financial statistics are not included. SHOW LESS READ MORE >