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Matalan risk profile downgraded

Ratings agency Standard & Poor’s had downgraded Matalan’s risk profile after the discount retailer posted a fall in profits.

The chain announced its earnings had plunged 90% in the second quarter as a result of operational problems at its warehouse in Knowsley, Liverpool.

In a Sunday Telegraph report this weekend S&P said: “We are revising our assessment of Matalan’s risk profile to ‘vulnerable’ from ‘weak’ and its management and governance practices to ‘weak’ from ‘fair’.

“We consider that Matalan faces a risk of its capital structure becoming unsustainable over the long term if the company is not on track to overcome the operational setbacks and restore its earnings to historical levels over the next 12 to 24 months.”

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