Moody’s revises AstraZeneca to negative

Moody's Investors Service said it affirmed the A2/provisional A2 and Prime-1 ratings of AstraZeneca plc and its guaranteed subsidiaries and changed the outlook to negative from stable.

The change in the outlook to negative was prompted by the weakening of AstraZeneca's credit metrics over the last 12 to 18 months with cash flow from operations/debt dropping to 36.5% as per LTM June 2015 from 61.5% at year-end 2013 as a result of material investments in the group's improving pipeline (impacting both R&D and SG&A expenses), material cash outflows from the restructuring of the business ahead of the genericisation of Nexium and Crestor in the U.S. (2015 and 2016 respectively) and to a much lesser extent from the first effects from the sales erosion of Nexium in the U.S.

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