We believe Canada-based dental support organization Dentalcorp Health Services ULC is likely to see a sharp contraction in demand due to the COVID-19 pandemic, as various provinces have declared states of emergency and recommended postponing elective procedures. Dental clinics will likely suffer near-term revenue and profit losses due to the decline in patient traffic, because most dental procedures are elective. We are affirming our 'B-' issuer credit rating on Dentalcorp and placing all of our ratings on the company and its debt on CreditWatch with negative implications. We expect to resolve the CreditWatch placement once we can assess the duration and magnitude of the impact the coronavirus will have on Dentalcorp's operational metrics, liquidity position, and potential recovery in late
