S&P puts Desarrolladora Homex on watch

Standard & Poor's said that it placed the BB- rating on Desarrolladora Homex SAB de CV on CreditWatch with negative implications.

S&P could lower or affirm the ratings once it evaluates Homex's financial and operating performance after the company reports its third-quarter results, the agency said.

The CreditWatch placement follows the perception of an increase in Homex's management risk tolerance, seen in its aggressive growth targets that have required significant investments in working capital and higher-than-expected use of debt, the agency added.

The company's aggressive growth targets and financial policy in a highly competitive market, its higher use of debt to support its growth plans and its significant working-capital requirements that have limited free operating cash flow generation limit the ratings on Homex, the agency noted.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.