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Casino’s Debt has been downgraded to Junk by the Standards & Poor Agency
- March 22, 2016 By Samantha A. -
The French retailer’s earnings have been highly pressured by the deteriorating business in Latin America. The Casino says that it is continuing with its plan to sell all of its assets in order to pay back its debt.
The rating agency of Standard & Poor stated Monday that it downgraded the Groupe Casino’s French retailer senior unsecured debt to a rating of BB+, thus pushing the Casino into the junk category, their previous rating of a BBB- thus putting high pressure on the company due to the difficult conditions within Brazil.
Although they have expected some recovery as well as an improvement in profitability with France, they do not believe that this would be a strong enough profitability in order to offset the severe operating weaknesses within Brazil, which they have been continually seeing throughout the year of 2016, stated a Standard & Poor representative.
This is the second largest publicly listed retailer in France, the Casino swung into the red stage in the year of 2015, due mainly to the fact of the continually deteriorating business operations in Latin America as they are facing high pressure to boost their profitability within its home country on which this group depends on now more than ever.
After Standard & Poor made their statement, the company has stated that they would indeed continue with their plans to sell all of its assets in order to pay back its debt as well as reintegrating its goal to generate €900 million ($1.02 billion) during this year in earnings before taxes, interest, amortization as well as depreciation.
Antoine Giscard d’Estaing the Casino’s chief financial officer stated that this does not in any way change the strategy of the group as they will continue with the deleveraging plans.
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