...Investor Meetings: Fitch Ratings European Retail and Fast-Moving Consumer Goods (FMCG) teams recently held a series of investor meetings on the food, beverages, consumer, tobacco and retail sectors. A number of common themes came up as a result of our discussions. This report highlights these questions, as well as Fitchs position. Stable Performance for Major Companies: Despite weak consumer confidence in Europe and developing markets in their second year of slower growth, cash flow generation for the major European food, beverages and tobacco companies is mostly healthy. Help has come from geographic diversification and flexibility in the cost structure. Notable exceptions are some of the retailers ¡ Tesco plc (BBB-/Negative) more than others ¡ and Imperial Tobacco Group PLC (BBB/Negative) because of higher exposure to the weak European markets. Leverage Rising: M&A activity, share buybacks and currency volatility, which are leading to a contraction in reported profits despite organic...
