An anonymous director reports
DBRS UPGRADES RATINGS ON SOBEYS INC. TO BBB (LOW) AND CHANGES TREND TO STABLE; S&P REVISES OUTLOOK TO POSITIVE
Dominion Bond Rating Service (DBRS) has upgraded the issuer rating and senior unsecured debt rating of Empire Company Ltd.'s Sobeys Inc. to BBB (low) from BB (high), and also changed the trends for Sobeys to stable from positive. DBRS stated in its press release announcing the upgrade, "The rating actions reflect the company's very strong operating performance in [fourth quarter fiscal 2019], well above DBRS's forecast, and the expectation that this recovery is sustainable going forward."
The company also announced today that Standard & Poor's (S&P) has revised the outlook for Sobeys to positive from stable, on improving operations. S&P stated, "The positive outlook on Sobeys reflects our increased confidence that the company will increase [earnings before interest, taxes, depreciation and amortization] as it continues to execute Project Sunrise while also integrating Farm Boy and expanding its discount store footprint." S&P did not revise its credit rating for Sobeys, which remains at BB plus. S&P noted that Sobeys could be upgraded within the next 12 months if certain conditions are met.
Empire Company is a Canadian company headquartered in Stellarton, N.S. Empire's key businesses are food retailing, through wholly owned subsidiary Sobeys Inc., and related real estate. With approximately $25.1-billion in annual sales and $9.6-billion in assets, Empire and its subsidiaries, franchisees and affiliates employ approximately 123,000 people.
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