RATING ACTION:
On June 15, 2023, CariCRIS upgraded the assigned issuer ratings by 1-notch to CariA (Local and Foreign Currency Ratings) on the regional rating scale and reaffirmed the Jamaica national scale ratings of jmAA (Local and Foreign Currency Rating) to GraceKennedy Limited (GKL or the Group). CariCRIS also upgraded by 1-notch on the regional rating scale, the Group’s bond issue of up to J $3 billion ratings to CariA (Local Currency Rating) and reaffirmed the Jamaica national scale ratings of jmAA (Local Currency Rating). A stable outlook was assigned.
RATING SENSITIVITY FACTORS:
Factors that could, individually or collectively, lead to an improvement in the ratings and /or outlook include:
- An improvement in CariCRIS’ sovereign credit risk rating of Jamaica
- Successful acquisitions and/or regional expansion over the next 12 to 15 months with a concomitant material improvement in any on its main segments’ market share and GKL Group’s overall financial performance
Factors that could, individually or collectively, lead to a lowering of the ratings and /or outlook include:
- Substantial and sustained deterioration in operating revenue of more than 7.5% over 2 successive years
- An increase in operating expenses as a percentage of revenue to more than 36% leading to a fall in operating profit margin to less than 6%
- Decline in the parent company’s DSCR ratio to <1.33 times or fall in effective DSCR to below 1.5x
- Increase in Debt to EBITDA ratio to >4.0 times
- A lowering of CariCRIS’ sovereign credit risk rating of Jamaica
Analysts’ Contact Info:
Anelia Oudit
Mobile : 1-868-487-8364
Brandon Singh
Disclaimer: CariCRIS has taken due care and caution in compilation of data for this product. Information has been obtained by CariCRIS from sources which it considers reliable. However, CariCRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. No part of this report may be published / reproduced in any form without CariCRIS’ prior written approval. CariCRIS is also not responsible for any errors in transmission and especially states that it has no financial liability whatsoever to the subscribers/ users/ transmitters/ distributors of this product.