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Bulletin: Woolworths Ratings Unaffected By A$700 Million Share Buyback Aug 10 Product Image

Bulletin: Woolworths Ratings Unaffected By A$700 Million Share Buyback Aug 10

  • Published: August 2010
  • Standard & Poors

FEATURED COMPANIES

Abstract
MELBOURNE (Standard & Poor's) Aug. 26, 2010--Standard & Poor's Ratings Services today said that its ratings on Woolworths Ltd. (A-/Stable/A-2) are unaffected by the retailer's fiscal 2010 results, which included the announcement of a A$700 million off-market share buyback. We note that Woolworths' credit metrics improved in fiscal 2010 and the 'A-' long-term rating can accommodate the announced share buyback. Nevertheless, we view the return of more than A$1 billion to shareholders within a 12-month period as aggressive for the 'A-' rating. As a result, Woolworths now has limited buffer at the 'A-' rating for any unexpected deterioration in financial performance, and the potential for downward rating pressure has been increased by this shareholder-friendly approach to capital management. Our concerns...

Companies mentioned in this report are: Woolworths Ltd.
Action: Bulletin

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Woolworths Ltd.

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