Kumho Tire said on the 7th that its corporations credit rating was raised two notches to A+ (stable) from A0 (stable).
Korea Ratings (HanShinPyeong), which conducted this evaluation, cited as reasons for the upgrade: ◇ a stable operating base in the global market ◇ expanded profit-generating capacity from improvements in a profitability-focused sales mix ◇ a reduction in borrowing fund based on operating cash flow.
HanShinPyeong analyzed that Kumho Tire established a stable business structure against external variables by diversifying major global transaction partners and production bases at home and abroad.
In particular, it viewed the aggressive expansion of distribution channels in North America and Europe and the improvement of the sales mix centered on high value-added products as the key drivers of performance growth. HanShinPyeong said the company is effectively reducing its debt burden based on the cash generation secured through these efforts.
Kumho Tire, which set a sales target of 5.1 trillion won this year, plans to focus on expanding its portfolio centered on high-inch and premium product lines.
A Kumho Tire official said, "With this credit rating upgrade, we have secured more favorable terms in the future funding market, and we also expect stronger sales competitiveness thanks to higher brand credibility," adding, "We plan to leverage strategic flexibility to solidify our financial structure and strengthen business stability."