WASHINGTON (dpa-AFX) - Fitch Ratings on Friday affirmed the Issuer Default Rating and long-term ratings for diversified machinery company IDEX Corp. (IEX) at 'BBB+'. The Rating outlook is Stable.
Fitch said the ratings affect about $1.5 billion of total debt including undrawn amounts under the revolving credit facility.
The ratings and outlook reflect Fitch's expectations for modest operating margin expansion from restructuring and modest organic growth. The demand environment remains mixed, with organic sales benefitting from the company's diversified revenue portfolio.
Geographically, for IDEX, weakness in Europe is offsetting stability in North America, while Asia is strengthening even as demand remains choppy, said Fitch.
IDEX's backlog grew in the most recent quarter and book to bill remains greater than 1 time (x), supporting expectations for low- to mid-single digit near-term revenue growth.
Profitability should modestly expand over the intermediate-term from productivity initiatives and restructuring, including headcount reductions and facilities consolidation.
Heightened focus on cost efficiencies and more fully integrating past acquisitions, spurred by the company's impairment charges in two businesses during 2012, should strengthen productivity.
Over the longer-term, operating EBITDA margins are expected to remain within the 20% to 25% range, which is supported by IDEX's Fitch estimated 20.2% operating EBITDA margin for 2009.
Lake Forest, Illinois-based IDEX Corp. makes various pumps, flow meters, other fluidics systems and components, and engineered products.
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