S&P ups SACI Falabella to BBB+

Standard & Poor's said it raised its corporate credit and debt ratings on SACI Falabella to BBB+ from BBB.

The outlook is stable.

"The upgrade reflects Falabella's solid revenue and SSS growth, with stable EBITDA margins of about 12%, which is in line with our expectations," S&P credit analyst Sandra Tinoco said in a news release.

The agency believes the company's cash flow generation will continue to fund its accelerated expansion program and its high working capital needs at CMR Falabella Chile, its credit card unit.

However, S&P said it believes Falabella compares favorably to peers due to its more diversified business and size, as well as stronger funds from operations. Therefore, S&P expects the company to maintain relatively stable debt levels with debt to EBITDA of about 2.0x and FFO to debt of 36% in the next two years.

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