Moody’s Chops Dominican Brewer

Moody’s has downgraded Cerveceria Nacional Dominicana’s (CND) corporate family and senior unsecured ratings to B1 from Ba3. The outlook is stable, up from negative. S&P downgraded the Dominican brewer to B from B+ last month. Moody’s cites weaker than anticipated operating performance and credit metrics compared with expectations, a higher tax burden, competition and softer demand. CND’s revenues have remained flat while earnings were under pressure following changes to the Dominican Republic’s tax regime, while pricing power has been pressured by the economic downturn. The ratings agency reports that the stable outlook reflects expectations the brewer will successfully refinance its $31m bridge facility by issuing local notes in the Dominican market, and begin addressing the maturity of its peso-linked 16% global notes in March 2012.