...August 3, 2020 PARIS (S&P Global Ratings) Aug. 3, 2020--S&P Global Ratings said today that Biogroup's parent CAB (B-/Stable/--) can absorb additional debt, but it will leave reduced rating headroom for operational underperformance. The latest transaction marks Biogroup's expansion of its operations outside France. Although we view the business additions as rating supportive in terms of profitability contribution and diversification, we note certain execution risks--mainly entering into new markets amid current uncertainties created by the COVID-19 pandemic and the effect on routine testing. We believe the pandemic creates risk and COVID-19-related demand remains uncertain. Even assuming substantial demand for highly profitable polymerase chain reaction (PCR) testing, a second wave could negatively affect routine testing. Biogroup's revenue in the five months to May 2020 reflected a material deterioration in volumes, revenue, and profitability due to the lockdown and the company's high fixed...
