S&P: Care UK view to negative

Standard & Poor's said it revised to negative from stable the outlook on Care UK Health & Social Care Investments Ltd.

The agency also said it affirmed the company's B long-term corporate credit rating.

S&P also said it affirmed the B rating on the senior secured notes issued by Care UK Health & Social Care plc. The recovery rating on these notes is unchanged at 3, indicating 50% to 70% expected default recovery.

The outlook revision reflects a view that if Care UK's continued debt-funded expansion does not lead to any material improvement in the group's profitability, it may compromise the group's ability to comfortably service its fixed costs and generate positive free operating cash flow, the agency said.

The outlook revision also considers the continued pressure on public reimbursement in the United Kingdom and the costs associated with Care UK's growth strategy, S&P said.

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