S&P downgrades Vinacomin

Standard & Poor’s said it lowered the long-term corporate credit rating on Vietnam National Coal and Mineral Industries Holding Corp. Ltd. (Vinacomin) to B from B+.

The agency also lowered the company’s long-term Asean regional scale rating to axBB- from axBB.

The outlook is stable.

The downgrades were due to Vinacomin’s cash flow adequacy and EBITDA interest coverage, which will likely be weaker than previously expected over the next 12 months, S&P said.

The downgrades also consider the company’s persistently high debt-funded capital spending amid tough operating conditions, the agency said.

The company’s debt-to-EBITDA ratio is expected to will exceed 5x over the next 12 to 18 months, S&P said.

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