Fitch lowers Orbis outlook to negative

Fitch Ratings said it has changed Orbis SA's outlook to negative from stable while the national long-term rating is affirmed at BBB+(pol).

The change in outlook reflects Fitch's expectations that the economic slowdown in Poland will impact Orbis over 2009-2010, resulting in lower cash flow generation and weaker financial flexibility.

The agency said it believes the Polish hotel operator is sensitive to the economic slowdown given its current hotel portfolio of 62, high operating leverage, relative small size compared to its international peers and concentration on one country.

Therefore, Fitch said it expects the EBITDA of the hotel division over the next two years may be lower than envisaged by the company while the performance of its transportation and travel business may also be affected by sluggish demand, volatile oil prices and the weaker Polish currency.

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