Fitch rates Grupo Bimbo BBB

Fitch Ratings said it assigned BBB long-term foreign- and local-currency issuer default ratings to Grupo Bimbo, SAB de CV. The agency currently carries an AA+(mex) national-scale long-term rating for the company and AA+(mex) ratings for its local certificados bursatiles issuances.

The outlook is positive.

Fitch said the ratings are based on the company's leadership position in the global bakery business, strong brand recognition and positioning in the markets where it operates and its extensive distribution network.

The ratings also incorporate Bimbo's improved business profile and geographic diversification, the successful integration of the Weston Foods acquisition, good operating results over the past 12 months, important reduction in debt levels and a better liquidity position, the agency said.

While the ratings take into account the stability of the packaged food sector, they also incorporate risks such as the exposure to volatility in commodity prices and changes in dietary trends away from high-carbohydrate foods, the agency said.

The positive outlook reflects Fitch's expectation that Bimbo will continue with its deleveraging strategy in the near-to-medium term and that it will reach its total debt-to-EBITDA target of 1.5 times over the next 18 months. The ratio was 2.1 times at the end of the first quarter.

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