After opening slightly down, Casino erased its losses and moves close to balance despite the deterioration in its credit rating by Standard & amp; Poor’s. The agency has made passing from BBB- to BB +, with a stable outlook, which is now debt Casino assets “speculative”. However, this evolution is not really a surprise since the S & amp; P was placed on 18 January, the rating under negative review Casino, making clear the threat of a deterioration in the French distributor.
Between 18 January and today, Casino has published annual results have not convinced Standard & amp; Poor’s. The 26% drop in EBITDA of the French group told analysts that the difficulties in Brazil will probably only partially offset by the recovery in activity in France
S & amp;. P justified also downgrading the rating category Casino Speculative by refocusing that the group is currently in its two main markets. Indeed, by selling its activities in Asia to carry out its debt, Casino will strengthen its exposure to France and Brazil. This lesser diversification is seen by the rating agency as a risk factor for Casino
However, and this is probably what explains the measured reaction of investors to the S & amp announcement. P, analysts are confident about the success of the distributor deleveraging. Thus, they believe that Casino will use the entire proceeds of such sales in Asia to reduce its debt and thus restore financial leeway. Standard & amp; Poor’s also stipulates that an increase in its rating could happen if Casino include strong growth in revenues and profits in France and if its ratio of debt to Ebitda back lower.
In response to the deterioration Casino has also reaffirmed its debt reduction program, calling it “imminent” the sale of the group’s stake in Big C Thailand for 3.1 billion euros and “satisfactory” the progress of the process concerning the activities Vietnam.
in addition, Casino said that the passage of its rating to speculative grade will result in a slight increase in the cost of its bond debt of less than € 20 million before tax 2016 off future bond redemptions. The group said it had at the end of 2015, before taking into account the debt reduction plan, “with a gross cash position of 1.7 billion euros and 3.9 billion credit lines undrawn confirmed , whose availability is totally independent of the S & amp rating; P “
.
No comments:
Post a Comment