Moody's affirms Bimbo, lifts view to stable

Moody's Investors Service said it affirmed the ratings of Grupo Bimbo, SA de CV's and revised the outlook to stable from negative.

Affirmed ratings include the global local senior unsecured issuer rating at Baa2 and Mexican national-scale rating at Aa1(mx).

The outlook change reflects the company's progress in gradually turning around its U.S. operations, the slow but consistent reduction of operating losses in its non-Mexican operations in Latin America and its efficiency improvements, which have allowed Bimbo to pay down debt and to improve its credit metrics, Moody's said.

Bimbo's ratings are based on its leadership position in its home Mexican bread market, supported by a robust and well-articulated logistics system within its entire Mexican territory, as well as a broad product array with over 4,500 products, the agency noted.

The ratings, though, are constrained by the still weak profitability of Bimbo's U.S. operations, which continue to be impacted by industry overcapacity due to weak demand trends, dietary fads, soft prices and the extended shelf life of bread and cakes, the agency added.

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