Moody's Downgrades Renault's Amid "Weakened" 2019 Performance

(Alliance News) - Moody's Investors Service on Tuesday downgraded Renault SA long-term ratings ...

Alliance News 18 February, 2020 | 6:23PM
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(Alliance News) - Moody's Investors Service on Tuesday downgraded Renault SA long-term

ratings to Ba1 from and its short-term ratings to non-prime, but kept a stable outlook.

Moody's said the downgrade was triggered by Renault's "substantially weakened operating performance, reported for the year 2019, "to a level no longer commensurate with the Baa3 rating category".

"Based on the company's 2020 guidance anticipating a further decline in the group's operating margin and the continuing weakness of the market environment, we do not expect that Renault will be able to restore healthy operating margin levels in the medium term," Moody's said.

Renault revenue fell 3.3% to EUR55.54 billion in 2019, down 2.7% at constant exchange rates. Sales reached 3.8 million units, down 3.4% on 2018. The group's operating margin slipped to 4.8% from 6.3% in 2018.

"Visibility for 2020 remains limited due to expected volatility in demand, notably in Europe because of the [Corporate Average Fuel Economy] regulation and the possible impacts of the coronavirus," said Clotilde Delbos, acting chief executive.

Renault shares closed 6.3% lower in Paris at EUR30.94 on Tuesday.

By Loreta Juodagalvyte;

Copyright 2020 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Renault SA 22.42 EUR 3.77

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