S&P lowers Falabella view to stable

S&P said it revised the outlook on SACI Falabella to stable from negative.

The agency also affirmed the company's BBB+ global scale issuer credit ratings.

S&P said it expects Falabella's top-line and EBITDA growth to be modest but consistent in 2019 and 2020 due to e-commerce growth, new store openings and relatively sound macroeconomic conditions in Peru, Colombia and Chile.

The recent capital increase of about $580 million would finance a portion of capital spending for the next two years, the agency said, so debt is expected to stay largely constant.

S&P said it believes Falabella will be able to maintain leverage at or less than 3x in the next two years.

Despite challenging market conditions in Chile – the company's largest operation – that took a toll on top-line growth, Falabella was able to reduce the leverage of its corporate operations in 2018 and report better operating results than expected in the base-case scenario, the agency said.

Economic growth in Peru and Colombia also is expected to remain solid in the next two years, S&P said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.