S&P lowers China South City

S&P said it lowered its long-term issuer credit rating on China South City Holdings Ltd. to B- from B. The outlook is stable.

At the same time, S&P lowered its long-term issue rating on the company's outstanding senior unsecured notes to CCC+ from B-.

“We lowered the rating on CSC to reflect that the company will continue to operate under challenging industry conditions and remain unable to materially deleverage in the next one to two years. We expect the company's liquidity position to remain tight with significant refinancing pressure in the context of a tough credit environment,” S&P said in a news release.

“We believe the company's capital structure is weak with a high proportion of short-term debt used to fund assets that have slow turnover and uncertain cash flow generation prospects.”

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