국제 신용평가기관인 피치(Fitch Ratings)가 23일 롯데쇼핑의 신용등급을 'A-'로 부여하고 등급 전망을 '안정적(Stable)'으로 제시했다.
피치는 롯데쇼핑이 국낸 25개 체인점을 바탕으로 시장점유율 42%를 확보하고 있는 국내 최대 규모의 백화점 체인으로 이 분야에서 가장 좋은 실적을 올리고 있다고 평가했다.
또한 롯데쇼핑이 현재 국내 시장에서 3위를 마크하고 있지만 지속적인 사업확장 계획으로 1위권으로 집입할 잠재력이 크다고 밝혔다.
등급 전망에 대해서는 "국내 시장의 소비 감소가 예상되지만 롯데쇼핑의 재무구조는 이같은 수요 감소를 견뎌낼 수 있을 것"이라고 평가했다.
아래는 피치사가 발표한 등급 발표 성명 원문.
Fitch Assigns 'A-' Rating To Lotte Shopping; Outlook Stable
Fitch Ratings has today assigned Korea's Lotte Shopping (Lotte) a Long-term foreign currency Issuer Default Rating (IDR) of 'A-' (A minus). The Outlook is Stable.
"The rating reflects Lotte's position as leading retailer in Korea. Lotte is Korea's largest operator of department stores, with a market share of 42% through its nationwide chain of 25 stores. Based on its dominant market share, Lotte enjoys bargaining power with suppliers, as well as economies of scale, making it the most profitable player in the sector. In the discount store sector, Lotte is currently number three but with its steady expansion plans there is potential for further top-line and profitability improvements through economies of scale," notes Jeong Min Pak, Director in Fitch's Corporates group.
The Stable Outlook is based on the agency's view that despite expectations of a decline in consumption, the company's financial position can withstand the expected downturn in demand and its credit profile will remain within the range of similarly rated companies.
Although the company's debt has increased recently with ongoing expansion both in Korea and overseas markets, Lotte still has one of the strongest balance sheets among its competitors For example, in FY08, Fitch estimates its adjusted net debt/EBITDA and adjusted FFO leverage in its non-financial operations were close to 1x, which compares favourably with similarly rated global peers. It also has robust cash generating capabilities through steady growth in operations, as well as positive working capital structure. Debt levels are likely to increase further reflecting the company's investment plans, but Fitch expects the company's credit metrics to remain robust. Negative rating factors would be adjusted net debt/EBITDA trending towards 2x and fixed charge coverage reaching 4.5x on a sustainable basis.
The company has recently been expanding overseas, opening new stores and acquiring stores in markets such as China, Russia, and Indonesia. "Given the company's lack of experience in overseas markets and the current global economic slowdown it could be a while before the overseas operations become as profitable as the domestic operations, which in the meantime could erode profitability," adds Ms. Pak. Having said that, Fitch expects the company to manage its CAPEX expenditures cautiously, depending on the economic environment.
The company also faces uncertainties in its operating environment due to the current economic downturn. Fitch expects the domestic economy to shrink by 2.4% in 2009, which is likely to affect domestic consumption, especially revenue in the department store segment which tends to be more vulnerable in an economic downturn. Lotte's ratings are also constrained by lagging profitability and by a potential increase in competition in the discount store segment and the lack of geographical diversification.
Lotte Shopping is a leading retailer in Korea which encompasses department stores, discount stores, supermarkets, TV home shopping, and internet shopping with 189 stores in operations. Consolidated gross sales in 2007 was KRW11.6trn. Lotte is also one of the key affiliates in the Lotte Group, which is a major conglomerate in Korea, and has relatively easy access to domestic financial markets.
피치는 롯데쇼핑이 국낸 25개 체인점을 바탕으로 시장점유율 42%를 확보하고 있는 국내 최대 규모의 백화점 체인으로 이 분야에서 가장 좋은 실적을 올리고 있다고 평가했다.
또한 롯데쇼핑이 현재 국내 시장에서 3위를 마크하고 있지만 지속적인 사업확장 계획으로 1위권으로 집입할 잠재력이 크다고 밝혔다.
등급 전망에 대해서는 "국내 시장의 소비 감소가 예상되지만 롯데쇼핑의 재무구조는 이같은 수요 감소를 견뎌낼 수 있을 것"이라고 평가했다.
아래는 피치사가 발표한 등급 발표 성명 원문.
Fitch Assigns 'A-' Rating To Lotte Shopping; Outlook Stable
Fitch Ratings has today assigned Korea's Lotte Shopping (Lotte) a Long-term foreign currency Issuer Default Rating (IDR) of 'A-' (A minus). The Outlook is Stable.
"The rating reflects Lotte's position as leading retailer in Korea. Lotte is Korea's largest operator of department stores, with a market share of 42% through its nationwide chain of 25 stores. Based on its dominant market share, Lotte enjoys bargaining power with suppliers, as well as economies of scale, making it the most profitable player in the sector. In the discount store sector, Lotte is currently number three but with its steady expansion plans there is potential for further top-line and profitability improvements through economies of scale," notes Jeong Min Pak, Director in Fitch's Corporates group.
The Stable Outlook is based on the agency's view that despite expectations of a decline in consumption, the company's financial position can withstand the expected downturn in demand and its credit profile will remain within the range of similarly rated companies.
Although the company's debt has increased recently with ongoing expansion both in Korea and overseas markets, Lotte still has one of the strongest balance sheets among its competitors For example, in FY08, Fitch estimates its adjusted net debt/EBITDA and adjusted FFO leverage in its non-financial operations were close to 1x, which compares favourably with similarly rated global peers. It also has robust cash generating capabilities through steady growth in operations, as well as positive working capital structure. Debt levels are likely to increase further reflecting the company's investment plans, but Fitch expects the company's credit metrics to remain robust. Negative rating factors would be adjusted net debt/EBITDA trending towards 2x and fixed charge coverage reaching 4.5x on a sustainable basis.
The company has recently been expanding overseas, opening new stores and acquiring stores in markets such as China, Russia, and Indonesia. "Given the company's lack of experience in overseas markets and the current global economic slowdown it could be a while before the overseas operations become as profitable as the domestic operations, which in the meantime could erode profitability," adds Ms. Pak. Having said that, Fitch expects the company to manage its CAPEX expenditures cautiously, depending on the economic environment.
The company also faces uncertainties in its operating environment due to the current economic downturn. Fitch expects the domestic economy to shrink by 2.4% in 2009, which is likely to affect domestic consumption, especially revenue in the department store segment which tends to be more vulnerable in an economic downturn. Lotte's ratings are also constrained by lagging profitability and by a potential increase in competition in the discount store segment and the lack of geographical diversification.
Lotte Shopping is a leading retailer in Korea which encompasses department stores, discount stores, supermarkets, TV home shopping, and internet shopping with 189 stores in operations. Consolidated gross sales in 2007 was KRW11.6trn. Lotte is also one of the key affiliates in the Lotte Group, which is a major conglomerate in Korea, and has relatively easy access to domestic financial markets.
