METALDOM receives A-(DOM) rating from Fitch Ratings
SANTO DOMINGO, Dominican Republic, Aug. 8, 2012 /PRNewswire/ — Dominican Metallurgical Complex, METALDOM, was assigned a long term A-(DOM) with positive outlook rating by Fitch Ratings, making it the strongest rated steel company in the Dominican Republic.
According to Fitch Ratings, “METALDOM’s rating reflects its position as one of the major participants in the manufacturing and commercialization of steel products for the construction sector.” METALDOM’s A-(DOM) rating was agreed based on the following elements:
- METALDOM’s stable perspective;
- the company’s strong positioning – 48.8% market share by December 2011;
- a projected medium-term vertical integration;
- a conservative capital structure;
- a strong liquidity position; and
- the operational risk involved in this type of industry.
“We are very pleased with this rating, which will only reinforce our commitment to maintaining our clients’ satisfaction by supplying metal and steel products of the highest quality, and to continue contributing to the development of the Dominican Republic,” said METALDOM’s Executive Vice President, Eduardo Gisbert.
Fitch valued METALDOM’s capital structure, which is conservative and expected to stay that way, positively. “This has been reflected in the sustained reduction of the debt levels during the last four years. Lower debt levels combined with higher profitability levels have resulted in a low level of Debt to EBITDA ratio,” notes the report, which places the company on a superior level to other companies of the sector in this sense.
METALDOM’s rating could improve in the next few years, according to the analysis, if the company successfully implements the regional expansion it has planned, which includes the installation of a steel complex in the La Brea area in Trinidad and Tobago.
The rating also highlights METALDOM’s good liquidity position. “The adequate cash flow generated by the operations and improved efficiency in work capital management has enabled METALDOM to finance its investment plans and generate a free cash flow, whose resources have allowed a reduction in the debt levels and the strengthening of the liquidity position,” specified the report.
METALDOM is a leading steel producer in the Caribbean based in the Dominican Republic. It is managed by VICINI, a private asset manager with investments in diverse industries including food and beverage, manufacturing, agriculture and energy, banking and financial services, media, tourism and real estate development in the Dominican Republic and the Caribbean.