DataPro, a technology-driven credit rating agency has in its latest report upgraded African Foundries Limited long-term rating to “A+” with a stable outlook for the year 2021/2022.
The rating of African Foundries Limited is supported by its strong revenue profile, good profitability, good liquidity, and an experienced management team.
DataPro rating committee approved the rating after an assessment of the company’s financial performance, corporate governance & risk management, regulatory
environment, risk factors, and future outlook of its current healthy profile in the medium to long-term period.
The “A+” indicates low risk. It shows very good financial strength, operating performance and business profile when compared to the standard established by DataPro. “African Foundries Limited in our opinion, has a strong ability to meet its ongoing obligations,” Datapro stated.
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African Foundries Limited had a short-term rating of “A1” which indicates good credit quality and satisfactory capacity for timely payment of financial commitments.
The company continues to enjoy a wide market share and increased revenue underpinned by a steady upgrade of operating capacity. The revenue growth trend of the company gained traction during the year under review.
Total earnings went up by 106 percent to N123 billion in 2021 from N59.8 billion in 2020.
Total liabilities comprised current and non-current liabilities which decreased by 22 percent to N56 billion in 2021 from N71.7 billion in 2020. This was largely due to a decline in current liabilities by 33 percent from N58.5 billion in 2020 to N39.3 billion in 2021.
DataPro noted that the rating carries a maximum shelf life of twelve calendar months, in line with International Best Practice. The rating is therefore not an offer to trade in securities nor a substitute for the user’s judgment. It is meant for reference purposes.
