Moody's Downgrades Spanish Retailer DIA
Ratings agency Moody's has announced it has downgraded the long-term corporate family rating (CFR) of Spanish retailer DIA from B2 to Ba2.
Moody's has also altered its probability of default rating (PDR) on DIA to B2-PD from Ba2-PD, and also downgraded DIA's senior unsecured long-term ratings to B2 from Ba2.
"Our downgrade of DIA's ratings and outlook change reflect the company's earnings trajectory and weakened liquidity," says Vincent Gusdorf, a Moody's vice president - senior analyst and lead analyst for DIA.
"DIA has yet to refinance its upcoming debt maturities and amend its covenants, which we believe could pressure its liquidity in the coming months, although we acknowledge that DIA continues to negotiate with its banks."
DIA announced in October that its operating profits for the nine month period to the end of September dropped by 24%, however like-for-like sales at the business were up 2.7%.
Commenting at the time, chief executive Antonio Coto said that the group wanted to focus on "looking ahead" and lift sales in its home market.
“We will concentrate our efforts in Spain, our main market, with a realistic and strict operating change plan in the short term, in order to reverse the current trend,” he said. “We will focus on customer’s satisfaction and on cash generation”.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine