S&P lowers Kerry to stable

Standard & Poor’s said it revised the outlook on Kerry Properties Ltd. to stable from positive.

The agency also said it affirmed the BBB- long-term corporate credit rating on Kerry and the BBB- long-term issue rating on the company’s guaranteed outstanding senior unsecured notes.

S&P also affirmed the cnA- long-term Greater China regional scale rating on Kerry and the notes.

The outlook revision reflects Kerry’s financial leverage, which is expected to remain elevated in 2015 to 2016 due to land acquisitions that were more aggressive than previously expected, the agency said.

The company made large land acquisitions in both Hong Kong and China in early 2015, which led to increased borrowings by 12% and EBITDA growth of 9%, S&P said.

But, Kerry’s earnings are expected to further stabilize, which should mitigate the company’s volatile property sales and large exposure to weak regional markets in China, the agency said.

© 2015 Prospect News.
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