S&P Global has revised its outlook on Wolverine Worldwide to negative but maintains its BB rating on the issuer credit rating. Wolverine ended the first quarter with a debt-to-equity ratio of 5.2x due to last year’s acquisition of Sweaty Betty, a $30 million settlement related to PFAS contamination at a former leather tannery site in Michigan and $40 million in share repurchases. That level already exceeds the 4.0x threshold that warrants a downgrade, but S&P said adjusted debt to Ebitda should fall back into the high-3x range by the end of the year. Wolverine’s order backlog is healthy, the rating agency said, and growth is expected to accelerate from Q2 as products start arriving (late) from Asian factories. For 2022, S&P expects low-double-digit revenue growth and similar Ebitda margins to 2021, despite a more promotional market as consumer buying patterns normalize.

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