Moody's Upgrades Rating On B&M Due To Strong Financial Track Record

(Alliance News) - Moody's Investors Service on Thursday upgraded B&M European Value Retail SA's ...

Alliance News 4 December, 2020 | 9:39PM
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(Alliance News) - Moody's Investors Service on Thursday upgraded B&M European Value Retail SA's Corporate Family Rating to Ba2 from Ba3 and that the outlook on all ratings is stable.

B&M on Thursday said it expects annual earnings to top market estimates and became the latest retailer to announce that it will forego business rates relief.

The value retailer said during first nine weeks of the third-quarter, customer numbers and like-for-like sales "have been slightly ahead" of the first half.

B&M expects annual adjusted earnings before interest, tax, depreciation and amortisation between GBP600 million and GBP650 million, topping the consensus estimate of GBP571 million.

Moody's said the rating action reflects the company's increased financial track record, as shown by a continued strong performance in 2020 driven by sales and Ebitda growth well above the average of the UK retail sector.

Moody's said: "In sharp contrast to clothing chains and many other retailers, B&M is emerging as a winner from the coronavirus crisis as it continues to win customers away from competitors. The company has outperformed both the food and non-food segments of retail in the past three years and continues to open new stores, contrary to traditional retailers.

"While scale and international diversification remain limited compared to rated peers, the strengths of B&M's business model have become more and more apparent over the last three years, with operating and EBITDA margins consistently twice as high as sector peers in the last three years."

The stock closed down 0.3% at 473.50 pence Friday.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
B&M European Value Retail SA 530.80 GBX 0.76 -

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