Fitch Ratings has affirmed Hemas Holdings PLC’s (Hemas) National Long-Term Rating at ‘AA-(lka)’ with a Stable Outlook.
The affirmation of Hemas’ rating reflects the company’s improved business risk profile after the successful integration of Atlas Axillia (Private) Limited (Atlas), a leading school and office stationery manufacturer, which it acquired in early 2018.
The acquisition has helped to increase the EBITDAR contribution from the defensive fast-moving consumer-goods (FMCG) segment from 35% to around 55%.
However, this positive development is counterbalanced by profitability pressure on Hemas’ pharmaceutical-distribution business, a slowdown in its Bangladesh FMCG operations and weak demand for its leisure segment, which limit any positive rating action in the short term.
The29 affirmation also reflects Fitch’s view that Hemas’ net leverage, defined as adjusted net debt/operating EBITDAR, will remain comfortably below 1.0x over the next two years (nine months ended 31 December 2018 (9MFY19): 0.8x) amid moderating capex, barring any significant M&A activity.
Add new comment