Ratings firm Moody’s has remained “positive” over Iceland Foods’ outlook, despite delivering weaker than anticipated results.
The firm’s comments comes following an update to Iceland’s bond holders and is the most up-to-date look at the frozen food retailer’s performance.
It was revealed that in the 12 months to 29 December 2023, EBITDA totalled £289m, which had remained broadly flat against £284m that Moody’s forecasted in September, The Grocer reported.
Iceland’s gross debt to EBITA ratio was 5.2x – higher than the 5.1x in September, and the 4.5x initially predicted by the agency for the year.
Moody’s said it “currently still expects the company to reduce its debt” despite the “somewhat weaker” than predicted results from the grocer.
However, the credit agency did not upgrade its rating on Iceland, citing Kantar data, which showed its share of the UK grocery sector remained “largely flat” over the last year.
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The update comes after Iceland saw debt increase by an additional £40m in the three months before December due to its store expansion programme.
In its last Companies House update, Iceland posted widening full-year losses following rising energy costs during the year to March 2023.
The grocery giant plunged to a £17.1m loss as it faced a “wholly unprecedented” £94m rise in its annual energy bill.
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