S&P lowers Volcan to negative

Standard & Poor's said it revised the outlook on Volcan Compania Minera SAA to negative from stable.

The agency also said it affirmed the company's BBB- ratings.

The outlook revision reflects the increased likelihood for a downgrade in the next 12 months due to the possibility that Volcan's financial risk profile and liquidity will weaken, said Diego Ocampo, an S&P analyst.

Although the agency said it expects the company's credit metrics to remain aligned with an intermediate financial risk profile, there is a likelihood for persistent deterioration in its debt ratios combined with a limited ability to generate free cash flow in the long term, which would lead to the erosion of its current robust cash reserves, unless the company lowers its maintenance capital expenditures and dividend payments.

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