Fitch affirms Swire Pacific

Fitch Ratings said it affirmed Swire Pacific Ltd.'s long-term foreign-currency issuer default rating at A, along with its foreign-currency senior unsecured ratings at A.

The outlook is stable.

The affirmations reflect Swire's stable and recurring rental income generated by its quality investment property portfolio, diversified business mix and its prudent financial management policy, Fitch said.

In fiscal year 2010 and the first half of 2011, its Hong Kong investment property portfolio benefited from positive rental reversions and achieved an average occupancy rate of 98% to 100%, the agency said.

Swire's liquidity remains strong and its short-term obligations of HK$11.5 billion are well covered by cash balances of HK$4.5 billion and committed undrawn facilities of HK$18.38 billion as of the end of June 2011, Fitch said.

This is offset by the company's continuing high capital expenditure needs, increasing exposure to China and ongoing volatility of its dividend flow from Cathay Pacific, the agency said.

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