S&P Cuts Iansa, Sees Tight Liquidity

S&P has lowered its ratings on Chilean sugar producer Empresas Iansa to CCC+ (negative) from B minus amid concerns over liquidity and financial flexibility over the next few quarters, given the upcoming harvest season for sugar beets, which often causes working capital investment to peak. “Iansa’s financial flexibility is aggravated by significant short-term debt maturities and projected minimal free cashflow, and the current limits on the firm’s incurring additional indebtedness,” says the agency. The ratings reflect a highly leveraged financial profile with narrow financial flexibility and a weak liquidity position. They also incorporate Iansa’s leading position as Chile’s only sugar producer, accounting for close to 60% of the country’s sugar market.