Fitch raises Rexel

Fitch Ratings said it has upgraded Rexel, SA's long-term issuer default rating and senior unsecured rating to BB from BB-.

The outlook is stable.

The agency said it has also affirmed Rexel's short-term issuer default rating and its €500 million commercial paper program at B.

"The upgrade follows Rexel's strong FY11 financial results despite slower sales growth in recent months, the company's highest profitability after the Hagemeyer acquisition in 2008 and, most importantly, proven strong free cash flow generation and ability to delever," said Pablo Mazzini, senior director in Fitch's corporates team in London.

Rexel has achieved its lowest net debt position since FY07 at €2.1 billion, and this equates to lease-adjusted net debt to EBITDAR of around 3.5x, the agency noted.

. Most importantly, EBITDAR to pre-dividend FCF remained above 30% (FY11: 34%), reflecting the low capital intensity of the business and good control over working capital despite strong sales growth in 2011 of 6.2% on a constant and same-day basis (or 4.5% excluding copper impact).

© 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.