Fitch Special Report: Fitch-Rated Mexican States: Medians of Key Indicators

MONTERREY, Mexico--()--Fitch Ratings publishes its Special Report 'Group of Mexican States Rated by Fitch: Medians of Key Indicators (2013).' This report briefly presents the performance of the main variables to be considered in the credit risk analysis process of the Mexican states. In order to provide transparency to the financial community, Fitch calculates the median of 22 variables regarding revenue, expenditure, capital expenditure, financial flexibility, indebtedness, sustainability, and other nonbanking or current liabilities.

The report shows that the state revenue to total revenue ratio of the group of Mexican states rated by Fitch (MSF) increased, mainly due to the incorporation of highly subsidized revenues, so they did not necessarily improve the financial flexibility of the entities. Likewise, with the exception of the entities rated 'AA(mex)', the rest of the MSF registered an additional reduction in free cash flow from operations (FCFO), a decline in capital expenditure and a weaker liquidity position, due to an increase in short-term liabilities.

The long-term debt relative to the ordinary fiscal revenues (current revenues) of the MSF continued to increase, but it remains at moderate levels for the entities rated 'A(mex)' and 'AA(mex)'. Also, debt service as a portion of FCFO remains at sustainable levels in such entities. Regardless, the majority of the states can still access funding in a prudent manner and maintain their leverage indicators at manageable levels. The financial flexibility of the states with high leverage levels, however, is being pressured by the greater resources destined for debt service.

Additional information is available at www.fitchratings.com.

Applicable Criteria and Related Research Group of Mexican States Rated by Fitch: Medians of Key Indicators (2013)
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=704407

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Contacts

Fitch Ratings
Gerardo E. Carrillo Aguado, +52 55 5202 1770
Fitch Mexico S.A. de C.V.
Blvd. Manuel Avila Camacho No. 88, Edificio Picasso, Mexico D.F.
or
Humberto Panti, +52 81 8399 9100
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1 212-908 0526
elizabeth.fogerty@fitchratings.com

Contacts

Fitch Ratings
Gerardo E. Carrillo Aguado, +52 55 5202 1770
Fitch Mexico S.A. de C.V.
Blvd. Manuel Avila Camacho No. 88, Edificio Picasso, Mexico D.F.
or
Humberto Panti, +52 81 8399 9100
Senior Director
or
Media Relations:
Elizabeth Fogerty, +1 212-908 0526
elizabeth.fogerty@fitchratings.com