DL Construction Achieves HUG Credit Rating Highest Grade 'AAA' for 5 Consecutive Years

[Asia Economy Reporter Kim Min-young] DL Construction announced on the 26th that it has obtained the highest rating of ‘AAA’ in the recent regular credit rating evaluation conducted by the Housing and Urban Guarantee Corporation (HUG). With this, DL Construction has maintained the highest rating for five consecutive years since 2018.

The HUG credit rating is calculated based on HUG’s internal standards using key financial indicators and financial ratios over three years. The ratings are divided into 15 levels, ranging from the top-tier AAA to the default rating D.

The evaluation items are divided into financial and non-financial models. The financial model assesses the company’s financial soundness based on ▲debt repayment ability ▲productivity ▲activity ▲profitability. The non-financial model calculates the rating by considering qualitative factors affecting corporate management activities such as ▲economic outlook ▲construction capability ▲business competitiveness ▲business prospects ▲representative credit risk.

The rating is used to determine HUG’s ▲guarantee fee rates (such as construction guarantees and subcontract payment guarantees) ▲loan interest rates ▲guarantee limits ▲approval authority for guarantees ▲guarantee review criteria.

In addition to HUG, DL Construction also received an ‘A-(Stable)’ corporate credit rating (unsecured bonds) from credit rating agencies such as Korea Ratings and Korea Investors Service in April. After being upgraded to A- last year and earning the title of an ‘A-grade construction company,’ DL Construction maintained the A- rating this year based on evaluation grounds including ▲good current business stability supported by abundant order backlog and construction experience ▲excellent profitability and financial structure secured through highly profitable housing projects ▲and the expectation of maintaining strong financial soundness based on solid cash generation capability.

A DL Construction official said, “We will continue to work hard to repay the high external trust placed in us.”