“The [issuer] downgrade reflects significantly negative operating results and thin coverage while a lower rating is precluded by SAMC’s relatively stable and ample unrestricted reserves, which cover its outstanding debt by 1.7x,” said S&P analyst Cynthia Keller.
The outlook is negative, reflecting S&P Global Ratings’ expectation SAMC’s financial turnaround efforts remain challenging and its margins may not improve sufficiently during the two-year outlook period.
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