DBRS Morningstar has also discontinued and withdrawn Metro's Short-Term Issuer rating. DBRS Morningstar notes that the discontinuation does not reflect any change in DBRS Morningstar's view of Metro's credit quality. The confirmations and Stable trends reflect a strengthening of Metro's earnings profile within the rating category through F2020, as evidenced by solid operating performance, including margin improvements and continued same-store sales growth, both before and during the Coronavirus Disease (COVID-19) pandemic. While uncertainties related to the intensity and duration of the coronavirus pandemic as well as the macroeconomic aftereffects remain, the confirmations and Stable trends also reflect DBRS Morningstar's view that Metro is well positioned to manage the current environment within the BBB rating category. Metro's ratings continue to reflect its well-established brand and market position in
DBRS Morningstar expects Metro's earnings will continue to benefit from elevated volumes in F2021, despite some continued costs related to the health and safety of customers and employees. That said, DBRS Morningstar believes Metro's sales growth will moderate in F2021, given the lapping of exceptionally strong sales for most of F2020, with sales forecast to grow in the low single digits to modestly above
DBRS Morningstar believes Metro's financial profile will remain relatively stable, with the Company's leverage expected to remain relatively flat. DBRS Morningstar expects cash flow from operations to track operating income and be approximately
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at: https://www.dbrsmorningstar.com/research/357792.
Notes:
All figures are in Canadian dollars unless otherwise noted.
The principal methodologies are Rating Companies in the Merchandising Industry (
For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.
The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.
The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.
Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar trends and ratings are under regular surveillance.
DBRS Morningstar will publish a full report shortly that will provide additional analytical detail on this rating action. If you are interested in receiving this report, contact us at info@dbrsmorningstar.com.
For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.
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Ratings
Date Issued Debt Rated Action Rating Trend Attributes
i
US = Lead Analyst based in USA
CA = Lead Analyst based in
EU = Lead Analyst based in EU
E = EU endorsed
U =
Unsolicited Participating With Access
Unsolicited Participating Without Access
Unsolicited Non-participating
14-Dec-20 Issuer Rating Confirmed BBB Stb CA
14-Dec-20 Senior Unsecured Debt Confirmed BBB Stb CA
14-Dec-20 Short-Term Issuer Rating Disc.-W/drwn Discontinued -- CA
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