S&P Upgrades Rassini to 'BB-' On Improved Financial Policy with a 'Stable' Rating Outlook

Rating is Rassini's second upgrade from S&P in approximately twelve months

Mexico City, September 3, 2014:

Standard & Poor's Ratings Services (S&P) announced that it has upgraded Rassini S.A. de C.V.'s long-term corporate credit rating from 'B+' to 'BB-' with a 'Stable' outlook.

S&P commented the following:

  1. Mexico-based auto supplier, Rassini, has continued to strengthen its financial policy, as seen in the prepayment of debt and improved credit metrics.
  2. We are revising our assessment of the company's financial policy modifier to "neutral" from "negative."
  3. We are therefore raising our long-term corporate credit rating on Rassini to 'BB-' from 'B+'.
  4. The stable outlook reflects our expectations that Rassini will continue to improve its cash flow generation, which will be enough to cover short-term debt amortizations, working capital needs, capital expenditures, and dividends payments. We also expect that the company will continue to achieve steady top-line growth and improve profitability thanks to continued recovery of U.S. auto sales that would offset sluggish results in the Brazilian market.

This new credit rating of 'BB-' represents the second upgrade that S&P has issued for Rassini in approximately twelve months. In August 2013, S&P raised the auto supplier's longterm corporate credit rating to 'B +' from 'B'.

Rassini's Chief Financial Officer, Sergio Visintini, commented on the new rating, "Our successful execution on the operational front has translated to record financial results in recent quarters. This impressive performance has, in turn, enabled us to deliver on our commitment to significantly reduce our overall debt, as evidenced by our recent 260 Million Mexican Pesos prepayment of our Suspensions Division North America Credit Facility. S&P's decision to upgrade our rating reflects our improved financial footing, which will better support our future growth."

In its report discussing the ratings change, S&P noted that the upgrade, "reflects the company's commitment to improve its credit metrics not only through stronger top-line growth, but most importantly, through debt reduction. Rassini has benefited from the currently positive momentum in the U.S. auto industry, which has resulted in improved operating performance and cash flow generation. Moreover, the company prepaid a portion of its debt for approximately $80 million for the past two years, which mitigated the refinancing risk of its fourth-quarter 2014 debt maturity."

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