Moody's Investors Service ("Moody's") has completed a periodic review of the ratings -and other ratings that are associated with the same analytical units for the rated entity(entities) listed below.

The review was conducted through a portfolio review discussion held on 18 July 2022 in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. A possible outcome from periodic reviews is a referral of a rating to a rating committee.

This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement.

Key Rating Considerations

The principal methodology used for this review was Building Materials published in September 2021. 

Key rating considerations on a forward-looking basis may include but are not limited to the following summarized below.

Scale: Scale is an indicator of a company's revenue-generating capability and its resilience to shocks, such as sudden shifts in demand or rapid cost increases. Large-scale companies generally have more flexibility to allocate capacity and absorb expenses under different demand and cost scenarios than small-scale companies, a consideration in the highly cyclical building materials industry. Total revenue is an indicator of scale.

Business Profile: The business profile of a building materials company influences its ability to generate sustainable earnings and operating cash flows. Core aspects of a building materials company's business profile include its geographic diversity, market position, product diversity, barriers to entry, degree of vertical integration and exposure to carbon regulation.

Profitability and Efficiency: Profits are considered because they are needed to generate sustainable cash flow and maintain a competitive position. A company's ability to manage its overall costs and maintain operating margins provides an indication of its ability to maintain its operations through economic downturns while continuing to pay its debt service. Some indicators of profitability and efficiency include Operating Margin, Operating Margin Stability, and EBIT/Average Assets.

Leverage and Coverage: Leverage and cash flow coverage measures provide indications of a company's financial flexibility and long-term viability. These metrics can also provide insight into management's philosophy regarding the company's capital structure and how much financial risk it is willing to undertake. Measures of leverage and coverage include Debt/Book Capitalization, Debt/EBITDA, EBIT/Interest Expense, and Retained Cash Flow/Net Debt.

Financial Policy: Financial policy encompasses management and board tolerance for financial risk and commitment to a strong credit profile is considered. Financial policy directly affects debt levels, credit quality, the future direction for the company and the risk of adverse changes in financing and capital structure. Financial risk tolerance serves as a guidepost to investment and capital allocation. The issuer's desired capital structure or targeted credit profile, its history of prior actions, including its track record of risk and liquidity management, and its adherence to its commitments are considered.

Other Considerations: Some other considerations may include financial controls and the quality of financial reporting; corporate legal structure; the quality and experience of management; assessments of corporate governance as well as environmental and social considerations; exposure to uncertain licensing regimes; and possible government interference in some countries. Regulatory, litigation, liquidity, technology, and reputational risk as well as changes to consumer and business spending patterns, competitor strategies and macroeconomic trends. Increasing environmental requirements and efforts to reduce greenhouse gas emissions (known as carbon transition risk) may lead to higher costs for building materials companies, especially cement producers. Stricter air pollution standards could also increase costs. Inability to pass compliance costs on to customers could erode profitability and cash flow generation. Disparities in regulations and associated costs are likely to favor some companies and create competitive challenges for others.

This announcement applies only to Rated Entities with EU rated, UK rated, EU endorsed, and UK endorsed ratings. Rated Entities, with Non-EU rated, non-UK rated, non-EU endorsed and non-UK endorsed ratings may be referenced herein to the extent necessary, if they are part of the same analytical unit.

Please see the Issuer page on Moody’s site for each of the ratings covered, most updated credit rating action, rating history, and Credit Rating action Press Release including the rating rationale and factors that could lead to a rating upgrade or downgrade.

List of Issuers/Rated Entities

• Aliaxis Holdings SA

• Brookfield Slate Holdings III Limited

• Compact Bidco BV

• Compagnie de Saint-Gobain

• CRH plc

• Dangote Cement Plc

• HeidelbergCement AG

• Holcim Ltd.

• HT Troplast GmbH

• Imerys S.A.

• Infinity Bidco 1 Limited

• LSF10 Edilians Investments S.a r.l.

• LSF10 XL Investments S.a r.l.

• Stellagroup

• Wienerberger AG