Casino Shares Fall on Moody's Downgrade Amid Tough Retail Environment in France
March 24 2023 - 6:15AM
Dow Jones News
By Giulia Petroni
Shares in Casino Guichard-Perrachon SA tumbled on Friday after
the retailer was downgraded by Moody's on the back of an
increasingly challenging environment for grocers in France.
At 0927 GMT, the stock was trading 6.8% lower at EUR6.25.
The financial-ratings agency lowered the French company's rating
to Caa1 from B3, and said the downgrade takes into account a
continued decline in the group's market share in French retailing,
as well as both a negative free cash flow and a reduction in retail
margins in France last year.
Moody's said it expects Casino to struggle maintaining its sales
volumes in the current year in an environment marked by high
inflation, low consumer confidence and rising costs. Free cash flow
in France is expected to remain negative for the next 12 to 18
months, the agency said.
"The downgrade reflects also the weak liquidity profile of the
company because the company will have to rely on the proceeds from
its ongoing asset disposal plan to repay upcoming debt maturities,"
Moody's said.
The agency noted that Casino still has to refinance or repay
around 1.2 billion euros ($1.30 billion) of outstanding notes by
2024 and a further EUR1.8 billion of outstanding debt in 2025.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
March 24, 2023 06:00 ET (10:00 GMT)
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