Moody's lowers Ericsson view to negative

Moody's Investors Service said it affirmed the A3 senior unsecured and provisional Baa1 senior subordinate ratings of Telefonaktiebolaget LM Ericsson (Ericsson).

The outlook was revised to negative from stable.

The outlook change was triggered by Ericsson's weak margin performance through 2012 and the cautious outlook for a near-term recovery in profitability, Moody's said.

The A3 ratings were affirmed on the company's $300 million senior unsecured regular bond/debenture due June 23, 2016; €375 million senior unsecured regular bond/debenture due June 27, 2014; $1 billion 4.125% senior unsecured regular bond/debenture due May 15, 2022; €500 million 5.375% senior unsecured regular bond/debenture due June 27, 2017; and €600 million 5% senior unsecured regular bond/debenture due June 24, 2013.

Although the agency said it expects an improvement of operating margins in the second half of the year, the magnitude of the expected improvement is likely to be limited and leave Ericsson's ratings weakly positioned in the current category, said Roberto Pozzi, a Moody's analyst.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.