Cemex Seen Hitting Financial Targets

S&P has affirmed its BBB (negative) long-term corporate credit rating on Cemex and its key operating subsidiaries Cemex Espana, Cemex Mexico and Cemex Inc. The affirmations reflect the agency’s expectation that although Cemex was not able to reach the 20% funds from operations-to-net adjusted debt ratio target 12 months after the acquisition of Australia-based Rinker, it will hit it during the next couple of quarters. “The progress the company has shown during the past couple of weeks in terms of asset sales and its debt reduction to date supports this expectation. We also believe that Cemex’s performance has been reasonable in light of the weakness in some of its key markets, particularly the US,” S&P says. The ratings action comes at the same time that Venezuelan media reports the announcement of a takeover by force of the Cemex assets after negotiations over nationalization of the company stalled.