Fitch ups Grupo Cementos, notes to BB

Fitch Ratings said it upgraded Grupo Cementos de Chihuahua, SAB de CV's local and foreign currency issuer default ratings and its $260 million senior notes due 2020 to BB from BB-.

The outlook is stable.

The upgrade reflects the strengthening of U.S. residential construction across several of the company's markets as well as a favorable economic environment in Northern Mexico that should support cement demand in the state of Chihuahua, the agency said.

Robust demand should result in continued high usage rates over the next few years and allow Grupo Cementos to maintain solid profitability and cash flow generation.

Fitch said the upgrade also considers Grupo Cementos’ improved credit profile following debt repayments during the past year, the recent bank debt refinancing and its solid liquidity, which should allow it to finance its planned South Dakota plant expansion without incurring debt.

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