By Tunde Oso
DataPro credit rating agency (CRA) has upgraded BUA Cement Plc with a long-term rating from “AA-” to “AA” with a stable outlook for the year 2021/2022.
The “AA” indicates lower risk, excellent financial strength, operating performance and business profile when compared to the standard established by DataPro. “This company, in our opinion, has a very strong ability to meet its ongoing obligations,” the report stated.
The DataPro Rating Committee approved the rating after assessment of the company’s financial performance, corporate governance & risk management, regulatory environment and future outlook of its current healthy profile in the medium to long term period.
The company’s revenue for the year ended 2021 increased by 23%. This is supported by the increase in sales volume resulting from enhancement in production capacity during the period. The production enhancement features an additional 3mmtpa to its existing installed capacity.
“Other major rating considerations of BUA Cement Plc,” the report added, “Include the company’s good funding, low exposure to credit risk & experienced management team.
BUA Cement Plc had a short-term rating of “A1”, which indicates good credit quality and satisfactory capacity for timely payment of financial commitments.
DataPro stated that the rating carries a maximum shelf life of 12 calendar months, in line with international best practices. “The rating is therefore not an offer to trade in securities nor a substitute for the user’s judgement. It is meant for reference purposes,” the report concluded.