Moody’s changes Penoles view

Moody’s Investors Service said it affirmed the Baa3 long-term issuer rating of Industrias Penoles SAB de CV and changed its outlook to stable from positive.

The agency said it continues to rate Penoles one notch lower than its subsidiary, Fresnillo plc, due to structural subordination considerations.

“Fresnillo is Penoles' largest subsidiary and it generates about 70% of the group's consolidated EBITDA, while holding only about 40% of the group consolidated debt,” the agency said in a news release.

“Peñoles' Baa3 rating also reflects its strong production profile and vertically-integrated operations, its solid earnings and cash generating capacity, supported by its competitive cost position.”

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