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S&P downgrades Boparan
S&P said it lowered its long-term issuer credit rating on Boparan Holdings Ltd. to CCC+ from B-. The outlook is negative.
At the same time, the agency lowered its issue rating on the company's £250 million senior notes due 2019, £330 million senior notes due 2021 and €300 million senior notes due 2021 to CCC+ from B-.
The 4 recovery rating is unchanged, indicating average (30%-50%; rounded estimate 45%) recovery prospects in the event of a payment default.
“The downgrade follows the Boparan group's recent quarterly results in which it reported continued operating underperformance,” S&P said in a news release.
“This was because it was unable to secure price uplifts in its protein segment to recover increases in commodity prices, including some feed cost components and ancillary inputs including packaging.
“This, combined with exchange rate fluctuations, disruption in the transition of its manufacturing facility in Scunthorpe, and closure of its West Bromwich site following public allegations of hygiene and food safety breaches, has seen its core protein business' reported EBITDA margins falling to about 1.25%.”
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