Moody's downgrades Oriflame

Moody's Investors Service said it downgraded Oriflame Investment Holding plc’s backed senior secured notes due 2026 to B3 from B2. The agency also lowered parent Oriflame Holding Ltd.’s corporate family rating to B3 from B2 and its probability of default rating to B3-PD from B2-PD.

"The downgrade to B3 reflects the weaker than expected operating performance and credit metrics, driven by a continuous decline in the number of sales representatives, the subsequent decrease in volumes, and the inflationary headwinds that have strained profitability," said Michel Bove, a Moody's assistant vice president, analyst and lead analyst for Oriflame, in a press release.

"Despite the weaker trends and metrics, the company decided to pay a dividend, reflecting a more aggressive financial policy than what we had originally factored in the rating," Bove added.

The outlook for both entities remains stable.

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