Fitch downgrades Oriflame

Fitch Ratings said it downgraded Oriflame Investment Holding plc's long-term issuer default rating to B from B+ and senior secured rating to B from BB-. The agency also revised the recovery rating to RR4 (42%) from RR3 (51%-70%).

“The downgrade reflects our expectation of significant challenges from doing business in Russia, which contributed 16% of total sales in 2021 and a Fitch-estimated one third of profits. This reduces the company's size and diversification. In addition, we assume margin pressure on its retained operations from cost inflation with limited price pass-through and from marketing costs linked to a mild resumption of events and a continuing challenging recruitment environment for its sales representatives,” the agency said in a press release.

The outlook is negative.

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