As rationale behind the rating upgrade, S&P highlighted the German building materials giant's ability to significantly reduce its debt in 2020, despite the COVID-19 pandemic, thanks to extensive cost-saving measures, resilient operating performance and strong cash flow. As a result, HeidelbergCement's leverage ratio (net debt to operating EBITDA) improved from 2.35x in 2019 to 1.86x, which is well within its target corridor of 1.5x-2.0x.
"Achieving a solid investment grade rating was a major goal in our Beyond 2020 strategy," says Dr. Dominik von Achten, CEO of HeidelbergCement. "My special thanks go to all our country management teams who acted very swiftly in challenging times and did an excellent job in delivering such strong results."
"We have built a track record of consistent deleveraging," says Dr. Lorenz Näger, CFO of HeidelbergCement. "This rating upgrade by S&P marks a major financial milestone for us as we have now delivered on both commitments that we made: we have reduced our leverage ratio to below 2.0x and reached a BBB flat rating."