S&P lowers IUSA

Standard & Poor's said it lowered Industrias Unidas S.A. de CV's long-term foreign-currency corporate credit rating to B- from B and the national scale rating to mxBB from mxBBB-.

The outlook is negative.

The agency said the downgrade reflects renewed weakness in IUSA's financial performance during second-quarter 2008 and continued concerns about its liquidity.

Ratings reflect the inherent cyclicality of the construction industry, commodity price volatility, competitive pressure, low operating margins and high leverage relative to operating cash flow generation, the agency said.

These factors are partially offset by the company's leading market positions in Mexico and the Unites States, its diversified product mix and some geographic diversification, S&P noted.

For the 12 months ended June 30, total debt-to-EBITDA ratio is 1 times.

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