The rating action highlights Masterplast's reliance on renewing short-term bank loans against a backdrop of reduced demand and difficult economic conditions, despite improved operational stabilisation through effective cost-saving measures.

The rating action reflects weaker credit metrics, driven by lower-than-expected EBITDA in an unsupportive macroeconomic environment and potential liquidity concerns.

The Negative Outlook reflects weaker credit metrics, driven by lower-than-expected EBITDA in an unsupportive macroeconomic environment.

Scope forecasts improved cash generation driven by regulatory tailwinds and the end of the capex-heavy expansion phase (2020-2022) helping to keep credit metrics under control amid a challenging environment.

The upgrade is driven by the company’s ongoing strong business performance thanks to continuous, subsidised investments in its production capacities leading to a further improvement in credit metrics.