Free Trial

HIGH YIELD: ZF Friedrichshafen (ZFFNGR Ba1/BB+[N]/NR): S&P Outlook Negative

HIGH YIELD
  • Subdued growth in the automotive market are pressuring ZFF’s profitability and cash flow outlook. Lower production volumes reduced its adj. EBITDA margin to 7% from 7.2% YoY.
  • FCF and disposal proceeds are committed towards debt reduction but restructuring costs are set to increase to €200mn next year.
  • S&P expects Adj. FOCF / debt around 5.7% in 2025, below its 7% rating threshold. Cash flow is constrained by the revenue base and higher interest costs although capex is expected to tick lower. FFO / debt is expected to be above the 20% rating threshold in 2025.
  • €500mn of divestment proceeds are expected in 2025 including €272mn already completed with Foxconn and excludes passive safety systems which is a potential further source of cash.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.