Fitch moves Dedalus outlook to negative

Fitch Ratings said it revised Dedalus SpA's outlook to negative from stable while affirming its long-term issuer default rating at B-. It also affirmed Dedalus Finance GmbH's €1.21 billion senior secured term loan B at B. The recovery rating remains at RR3.

“The negative outlook reflects slow deleveraging progress and tighter liquidity on the back of only partial completion of old invoice collection following enterprise recourse planning (ERP) system functionality issues. Despite the company's strong position in the fragmented European healthcare software market, Dedalus is facing structurally higher R&D costs and has limited flexibility to increase prices under long-term contracts with publicly funded healthcare customers,” Fitch said in a press release.

The agency said it forecasts Dedalus’ Fitch-defined EBITDA leverage to top 10x by end-2023 before declining to below 8x in 2025.

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