S&P revises Ontex view to negative

S&P said it revised Ontex Group NV’s outlook to negative from stable but affirmed its BB- issuer rating.

“Weaker-than-anticipated operating performance at Ontex will likely reduce covenant headroom in first-half 2021. In 2020, Ontex reported weaker-than-expected performance, with revenue declining 8.5% versus 2019 to €2.087 billion, on the back of lost contracts with some European retailers, mainly in the baby diapers segment and foreign exchange rate headwinds from currencies like the Brazilian real, Mexican peso and Turkish lira,” S&P said in a press release.

The agency warned it could downgrade Ontex within the next six months if it sees further weakening in its covenant headroom or does not refinance its upcoming maturities.

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