S&P Global Ratings upgraded its long-term issuer credit rating for Abbott Laboratories to a BBB+ from BBB, saying that the company "significantly outperformed" the rating agency's base-case projections for EBITDA growth and debt repayment.
The medical device maker improved its 2018 leveraging ratio to 2.5x due to strong EBITDA margin expansion and $8.3 billion of debt repayment in 2018, according to the rating agency.
S&P Global Ratings said it expects further leverage reduction for Abbott, projecting a reduction to 2.2x by the end of 2019.
The agency's outlook on the company is positive, reflecting the expectations for further leverage improvement and the potential of a higher future rating if the company's performance remains strong.
Abbott's debt reduction comes shortly after the company purchase of St. Jude Medical Inc. and Alere Inc. in 2017, according to the ratings release.
The rating agency also changed Abbott's unsecured debt rating from BBB to BBB+.
This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.