Chile retailer Cencosud says focused on cutting debt level
SANTIAGO, April 25 (Reuters) - Chilean retailer Cencosud is focusing this year on reducing its debt level to keep its investment-grade credit rating, its chief executive said on Friday.
Cencosud, one of South America's largest retailers, has a high debt-to-earnings ratio after increasing acquisitions across the continent, leading ratings agencies to grade it just a notch above junk.
"We are working to keep our investment grade," said chief executive Daniel Rodriguez to journalists after the company's annual general meeting.
"Our expectation is that from here to the end of the year we should be in the order of 3x (debt to earnings before interest, tax, depreciation and amortisation)."
Last year Cencosud, which owns supermarket chain Jumbo, home improvement chain Easy and Paris department stores, ended with debt to EBITDA of 3.4x.
Moody's rates Cencosud Baa3, while Fitch earlier this month confirmed the company as BBB-, outlook negative, citing its high leverage and its exposure to economic woes in neighboring Argentina, where it has significant operations.
Cencosud said in January that it would shy away from purchases and cut investment in 2014 as it consolidated recent Brazilian and Colombian acquisitions.
"The focus that the company has today is consolidation ... that's what we're going to keep working on in the next 12 to 24 months," Rodriguez said on Friday. (Reporting by Felipe Iturrieta; Writing by Rosalba O'Brien; Editing by Meredith Mazzilli)
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