Fitch downgrades West China Cement

Fitch Ratings said it downgraded West China Cement Ltd.'s long-term issuer default rating and senior unsecured debt rating to BB- from BB. Fitch also lowered the rating on WCC's $600 million of senior unsecured notes due July 2026 to BB- from BB. The recovery rating on the notes is RR4.

WCC's aggressive capital expenditures, mostly outside China, pushed leverage leading to persistently negative free cash flow, the agency said.

“We expect WCC's persistently negative FCF generation due to the high capex to continue in 2023 and 2024. The high capex has also caused its leverage to increase rapidly, reaching 3.2x in 2022 from 2.2x in 2021, and we forecast it to remain around 3x in 2023 and 2024,” Fitch said in a press release.

The outlook is negative.

© 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.