S&P ups CSN, National Steel

Standard & Poor's said it raised the corporate credit rating on Companhia Siderurgica Nacional to BB+ from BB and removed it from CreditWatch, where it was placed with positive implications on May 30.

S&P also raised the corporate credit rating on subsidiary National Steel SA to BB- from B+.

The outlook is positive.

The upgrades reflect CSN's improved cash flow protection measures and expectation that incremental operating cash flow will allow the company to successfully fund its aggressive capital expenditure program, according to the agency.

Ratings reflect the company's aggressive capital expenditure, exposure to volatile cycles in demand and pricing, and increasing competition in its home and primary market of Brazil, S&P said.

These risks are partially offset by CSN's strong cash reserves, privileged cost position and sound operating profile in both steel and iron ore, favorable Brazilian market shares in steel, strong export capabilities to offset occasional slowdowns in domestic steel demand and growing business diversification, the agency said.

CSN reported a total debt-to-EBITDA ratio of 2 times for the 12 months ended March.

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