S&P lifts American Crystal Sugar view to stable

Standard & Poor's said it affirmed the BBB+ long-term and A-2 short-term corporate credit ratings on American Crystal Sugar Co., and revised its outlook to stable from negative.

The outlook revision reflects the improved operating outlook for the company because of a significantly larger 2015 harvest, S&P said.

The outlook revision also considers an October 2015 ruling by United State officials against Mexico for illegally dumping subsidized sugar into the United States.

The ruling allows the United States to keep a five-year suspension agreement in place that regulates the volume and price of Mexican sugar imports, which reduces the risk of oversupply and low sugar prices, S&P said.

Based on a double-digit increase in harvest ton in 2015 and low-single-digit increases in sugar prices, the agency said it believes EBITDA will rebound in fiscal 2016 and restore the cooperative's cash-flow ratios to historical levels, including debt-to-EBITDA of less than 1.5x.

© 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.