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Fitch: Latin America Packaged Foods Enjoy Stability, Diversification and Growth
June 19, 2017 / 8:35 PM / 4 months ago

Fitch: Latin America Packaged Foods Enjoy Stability, Diversification and Growth

(The following statement was released by the rating agency) MONTERREY, June 19 (Fitch) The Latin America packaged foods sector's stable credit profiles and outlook rest on their strong business positions and sound financial profiles, along with adequate leverage and liquidity, according to a new Fitch Ratings report. "The Latin America packaged food industry is less exposed to weak economic cycles, which is reflected in less volatility in operating margins and good cash flow generation. Fitch expects higher economic activity in the region and issuers' average sales growth to reach the mid- to high single digits for 2017-2018," said Rogelio Gonzalez, Director. The industry benefits from geographical diversification, and an associated reduction in business risks and volatility. Raw material pricing should remain stable, though local currency volatility versus the U.S. dollar could pressure profitability. Merger and acquisition activity is expected to be active on improved leverage. Small- to mid-size acquisitions in the short- to medium-term will dominate, and this should help to diversify their operations. Acquisitions will likely be directed toward overseas operations, given the established domestic market share and scale. For more information, a special report titled "Latin American Packaged Foods Handbook" is available on the Fitch Ratings web site at www.fitchratings.com, or by clicking on the link. Contact: Rogelio Gonzalez Director +52-81-8399-9134 Fitch Mexico S.A. de C.V. Prol. Alfonso Reyes 2612 Monterrey, N.L., Mexico Johnny Da Silva Director +1-212-908-0367 Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: elizabeth.fogerty@fitchratings.com. Additional information is available on www.fitchratings.com Related Research Latin American Packaged Foods Handbook (Stable Credit Profiles Facing Some Risks) here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. 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