S&P: GS Caltex view negative

Standard & Poor's said it affirmed the BBB+ long-term corporate credit rating on GS Caltex Corp. and revised the outlook to negative from stable, reflecting increased leverage due to aggressive capital investments combined with a bearish industry outlook.

The A-2 short-term corporate credit and BBB+ long-term foreign currency senior unsecured debt ratings were affirmed.

The revision reflects GS Caltex's weakened cash flow adequacy and capital structure due to an increase in debt to fund capital investments, according to the agency.

Ratings reflect the company's strong position in the Korean market for petroleum refining and marketing, and its operating efficiency, the agency said.

These factors are offset by the company's exposure to cyclical crude oil prices, fluctuations in foreign exchange rates and its heavy investment burden over the next few years, the agency noted.

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