Moody’s rates LSF10 Impala, facilities B1

Moody's Investors Service said it assigned a B1 corporate family rating and a B1-PD probability of default rating to LSF10 Impala Investments Sarl.

Concurrently, the agency assigned B1 ratings to the company’s €580 million senior secured term loan B and €90 million senior secured revolving credit facility.

The outlook is stable.

Moody’s said the B1 corporate family rating is supported by: (a) The group's very strong and historically stable market position in the consolidated French roofing market; (b) its strong competitive position in the French roofing market due to the capital intensity of the business model, the need to have access to high quality but scarce clay reserves close to production plants, the customer stickiness and the low value to weight ratio, which requires a dense network and protects market shares of incumbents; and (c) the company's very high profitability compared to competitors, which is supported by structural rather than cyclical factors (high quality clay reserves, geographical footprint in the French market, superior brand, larger share of higher margin accessories and lower cost basis partly due to higher automation of production process.).

The rating is also supported by a high exposure to more resilient renovation activities and the depressed level of renovation activity in the French roofing market, which offers good recovery prospects over the next two to three years; and the company's strong cash flow generation supported by the high operating margins and a good cash conversion rate, the agency explained.

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