Philips: Moody’s downgrades outlook to ‘negative’

( – The rating agency Moody’s Investors Service announced on Friday that it had lowered the outlook associated with Philips’ debt from ‘stable’ to ‘negative’, while maintaining its ‘Baa1’ rating.

Moody’s says in a statement that its decision reflects the risk that the Dutch healthcare supplier’s credit profile will remain depressed for an ‘extended’ period if it encounters difficulties in meeting its order book, returning to sales growth or improve its margins.

The financial rating agency also says it is concerned about the possibility of additional financial costs related to the recall program for its defective respiratory devices, particularly in the event of legal action by potential plaintiffs.

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