S&P Global Ratings upgraded Jardine Strategic Holdings Ltd.'s long-term issuer rating to A+ from A, while revising its outlook to stable from positive, citing its expectations the company will maintain its conservative financial policy and limit investment spending in the next two years.
The rating agency expects Jardine's debt-to-EBITDA ratio to stay below 2x in the next two years, despite the possibility of more volatile macroeconomic conditions. The company's leverage from 2013 to 2016 was in the 1.1x-1.4x range, a trend the rating agency expects will continue.
S&P Global Ratings also expects the company to lessen its expansionary investments based on its conservative risk appetite and financial policy.
The rating agency expects the industrial conglomerate to have weaker revenue growth than the GDP growth of the respective countries it operates in. It forecasts a slight decline in EBITDA margins to between 12.0% and 12.5% in 2019 and 2020, from 14.6% in 2018.
S&P Global Ratings said Jardine's geographical and business segment diversity works in favor of stability in cash flows and earnings.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.
