UK - Standard & Poor's Ratings Services has downgraded its long-term debt rating for ITV because of a "ballooning" pensions deficit and poor first-half performance.
The ratings agency said it had lowered its long-term corporate credit and senior unsecured debt ratings on the broadcaster to B+ from BB-. It said the outlook was "negative".
It said it based its opinion on ITV's lower-than-expected first-half 2009 performance and its ballooning pension deficit.
And it said it believed it may take longer than expected for ITV to restore its operating margin to healthier levels - despite its lower cost base and a stabilisation in the UK advertising market.
This comes just weeks after ITV preliminary results announced the firm was consulting over changes to its scheme - including capping the growth of pensionable salary - in a bid to reduce its pension scheme deficit of £538m (US$890m). (Global Pensions, Aug. 6, 2009)
The television company also revealed the deficit on the firm's defined benefit schemes was £538m at the end of June compared to £178m at the end of 2008.
ITV said the increase reflected a decline in the value of scheme assets and the impact on liabilities of a higher inflation assumption, partly offset by £30m of regular deficit funding.
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