(RTTNews) - Thursday, global medical device company Orthofix International NV (OFIX: News ) said both Standard & Poor's Rating Services and Moody's Investor Services have upgraded their outlook for the company from negative to stable.

Orthofix said, Moody's Investor Services revised its outlook on Wednesday, citing "improvement in the spine implant business, which has contributed to margin expansion and improved free cash flow and improved credit metrics and an improved liquidity profile, including an increased cushion under the financial covenants due to several voluntary loan prepayments made prior to their scheduled maturities.

Moody's also acknowledged Orthofix's "relatively smooth transition to its next generation biologics product, Trinity Evolution, as well as the continued positive operating performance of the orthopedic and sports medicine businesses."

According to Orthofix, Standard & Poor's Rating Service also revised its outlook earlier this month, noting "recent improvements in the company's operating performance and debt reduction."

Standard & Poor's attributed the company's improved performance to "a reorganization that better focused its distribution and the launch of new products, such as a pedicle screw system, interbody device, and stem cell-based allograft; as well as the ongoing growth of its spine stimulation revenues."
The rating service also alluded to Orthofix's diverse revenue stream, describing the company's product and customer diversity as strengths.

Orthofix's President and CEO Alan Milinazzo said, "Our focus will continue to be on improved operating results and cash flow, as well as the continued deleveraging of our balance sheet. Our recent improvements are, in part, a reflection the successful introduction of several new products that have been well received by our surgeon customers."

Last month Orthofix released its third-quarter results, which included year-over-year improvements in its gross and operating profit margins, as well as a significant increase in cash flow from operations. As a result of the improved cash flow, the company made an additional $5 million debt repayment ahead of its scheduled maturity, and has repaid a total of $25 million ahead of scheduled maturities year-to-date.

OFIX is currently trading at $30.89, down $0.48, on the Nasdaq.

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by RTT Staff Writer

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