SAN MIGUEL Corp. (SMC) has been assigned the highest credit rating by a local debt watcher for its planned shelf registration of P60 billion commercial papers.
In a statement yesterday, Philippine Ratings Services Corp. (PhilRatings) said it is giving the food and beverage conglomerate a credit rating of PRS Aaa (corp.) for the planned issuance.
The rating was also given a stable outlook, meaning it is expected to hold for the next 12 months.
Based on PhilRatings’ metrics, a company whose bonds have a credit rating of PRS Aaa means it has a “very strong” capacity to meet its financial obligations.
Aside from the credit rating for the P60-billion bonds, PhilRatings also maintained SMC’s PRS Aaa rating for its outstanding P70-billion fixed-rate bonds and notes. This rating was likewise given a stable outlook by the debt watcher.
PhilRatings said it based its ratings on SMC’s “well-entrenched market leadership” and the “solid track record” of its subsidiaries. It noted the stable demand and the growing domestic economy is expected to keep the company’s finances afloat.
A reduced need for debt financing due to the progressive completion of its capital-intensive projects was also accounted for by PhilRatings, along with its aggressive growth strategy in the coming years.
“SMC benefits from its diversified business portfolio, with a mix that balances the Company’s performance throughout the economic cycle, thus providing stability to SMC’s overall profitability,” it said.
It noted the company’s products are “relatively resilient” and “able to ride out to economic downturns,” therefore it is expected to keep its financials in check.
SMC’s attributable net income in the first nine months of 2019 inched up 2% to P20.24 billion, driven by its energy and food and beverage businesses that recorded higher volumes.
Shares in SMC at the stock exchange gained P0.60 or 0.46% to close at P132.10 each on Wednesday. — Denise A. Valdez