S&P downgrades Apoteket

S&P said it lowered the issuer credit rating on Apoteket to A- from A.

Apoteket reported weaker operating performance than anticipated in 2018 with reported EBITDA declining 21% year-over-year, the agency said.

The company is expected to have difficulties improving its adjusted EBITDA margin at higher than 5% over the next two years and maintain its stable, market-leading position amid increasing competition in Swedish pharmaceutical retail and continuing necessary investments in e-commerce, S&P said.

The downgrades also reflect Apoteket's an expectation that the company's margins will remain under pressure in the coming years at about 5% or less, the agency added.

It also encompasses the steadily increasing competition in the Swedish pharmaceutical retail market, challenging Apoteket's leading position, S&P said.

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