S&P affirms Axtel ratings

S&P said it affirmed its long-term BB issuer and issue-level credit ratings on Axtel SAB de CV.

“The stable outlook reflects our expectation that during the next 12-18 months, the company will continue to deleverage with debt to EBITDA slightly below 4.0x, thanks to its new operational focus on its TIC segment. We also expect free operating cash flow (FOCF) to debt to remain around 4.5% because the industry is capital-intensive,” S&P said in a news release.

The ratings affirmation follows Axtel's plan to focus on more profitable business lines, concentrating on enterprise and government customers, which have steady EBITDA margins of around 40%.

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