Fitch downgrades Unilever

Fitch Ratings said it downgraded Unilever NV's and Unilever plc's long-term issuer default ratings and senior unsecured ratings to A from A+.

The outlook is stable.

Fitch also said it affirmed the short-term issuer default ratings at F1.

The downgrades reflect a revised view of Unilever's de-leveraging prospects as the company remains committed to maintaining its leverage in line with its internal target of 2x, Fitch explained.

Increasing internal cash flows due to organic growth and operating efficiencies are likely to be used for mergers and acquisitions, and potential share buybacks, rather than debt reduction, the agency said.

The ratings are underpinned by Unilever's strong business profile as one of the largest consumer goods and food companies globally and its proven ability to grow profitability through active management of its brand portfolio and cost savings, Fitch said.

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