Moody's affirms Thomson

Moody's Investor's Service affirmed the B1 corporate family rating for Thomson SA and the Caa1 junior subordinated rating for Thomson's perpetual junior subordinated bonds.

The outlook has been changed to negative from stable, the agency said, noting that the rating action was prompted by the company's announcement that Q3 sales were down by 7.9% at constant currency (13.2% in real terms) when compared to Q3 2007.

This is below Thomson's previous guidance which forecast constant currency revenue decline to the negative 4.3% level experienced in the second quarter 2008, Moody's said, adding that it believes that covenant headroom may further tighten somewhat albeit the highly profitable Technology Division with its quite stable licensing income reported a 7.9% increase in revenues.

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