SAPPI LIMITED

quarters ending from January 2012 to July 2012 and 4.00 to 1 for the quarter ending September
2012, and
(iii) With regard to Sappi Southern Africa (Pty) Ltd (previously Sappi Manufacturing (Pty) Ltd) and
its subsidiaries only, at the end of any fiscal year, the ratio of net debt to equity must not exceed
0.65:1, and the ratio of EBITDA (before special items) to net interest paid must not be less than
3.00:1.
The table below shows that as at September 2010 we were in compliance with these covenants.
With regards to our financial covenants, EBITDA is defined under the relevant agreements and net debt
is calculated using average exchange rates for fiscal 2010.
Fiscal 2010 Covenants
(US$ millions)
Group Covenants
Net Debt to EBITDA ............................ 2.70 2.0
Net Debt to Equity ............................. 36.61% 3.0
The Group financial covenants also apply to our securitization programs, included in the
US$ 912 million amount mentioned above, with outstanding balances of US$ 447 million at the end of
September 2010. No Sappi Limited guarantee has been provided for these facilities.
Credit ratings
At the date of this Annual Report, our credit ratings were as follows:
Fitch South African national rating
Sappi Southern Africa (Pty) Limited . . . A / F1 / Stable (March 2010)
Moody’s international rating
Sappi Papier Holding GmbH
(Supported by Sappi Limited
guarantee) .................... Ba3 / NP / Stable (September 2009)
Secured Debt Rating .............. Ba2 (September 2009)
Unsecured Debt Rating ............ B2 (September 2009)
Standard & Poor’s (S&P) international
rating
Corporate Credit Rating ............ BB� / B / Stable (September 2009)
Secured Debt Rating .............. BB (September 2009)
Unsecured Debt Rating ............ B+ (September 2009)
In May 2009 S&P revised its rating for the Group from BB to BB�, while moving the outlook from
negative to stable. This change was mainly the result of an industry-wide re-rating of the European
Forest Products sector, sustained cost inflation, and an uncertain outlook for paper pricing and demand
in the light of an expected softening of economic growth. One of the key requirements of this rating was
the successful refinancing of material 2010 debt maturities. This refinancing took place in August 2009
and S&P subsequently confirmed the rating.
In June 2009 Moody’s revised their rating from Ba2 to Ba3, with a stable outlook. The main reasons
for this revision were the difficult market conditions in the European paper industry, and the slower than
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