Fitch affirms InRetail Real Estate Corp at 'BB+'; Outlook Stable

09:59 | New York (U.S.), May. 24.

Fitch Ratings has affirmed the Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) of InRetail Real Estate Corp. (InRetail Real Estate) at 'BB+'.

Fitch has also affirmed the senior unsecured bond issued by InRetail Shopping Malls at 'BB+'. 

InRetail Real Estate's ratings incorporate the strong credit linkage of the company with its parent InRetail Peru, which manages and owns 100% of InRetail Real Estate S.A. (BB+/Stable; real estate business), 99.98% of Supermercados Peruanos S.A. (supermarket business), and 87.02% of InRetail Pharma (BB+/Stable).

"Fitch views these businesses as core and strategically important for InRetail Peru's business model," it said.

InRetail Peru's revenues, EBITDA, EBITDAR, and cash position in FY2018 were S/12.2 billion, S/1.2 billion, S/1.5 billion, and S/663 million, respectively. The supermarket, pharma, and real estate businesses represented 29%, 45%, and 26%, respectively, of InRetail Peru's FY2018 total EBITDA. 

InRetail Real Estate has the leading position in Peru's shopping malls industry. It also benefits from stable and predictable cash flow generation and favorable industry fundamentals. 

Likewise, InRetail Real Estate maintains an estimated 23% market share as measured by its participation in Peru's total GLA as of Dec. 31, 2018. 

"Fitch views the company's market position in Peru's shopping mall industry as solid for the medium term," it added. 

InRetail Real Estate's margins are stable and supported by its lease structure, with fixed-rent payments representing approximately 87% of total rental income. EBITDA margins are anticipated to remain stable at around 81% for 2019-2021. 


Published: 5/24/2019
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