Marks&Spencer's (M&S') topline is expected to contract by 10%-12% in the fiscal year ending March 31, 2021 (FY2021) amid the pandemic and related lockdowns. The clothing and home segment (C&H) has felt most of the brunt. However, the future release of working capital, plus several cash preserving measures, cost controls, and a supportive financial policy should enable the group to reduce debt. We are therefore affirming our rating on M&S at 'BB+' and removing our CreditWatch Negative placement. The negative outlook indicates the persistent downside risk arising from the challenging trading environment, the uncertain length of lockdown measures, and execution risk in turning around the C&H division, which could prevent M&S from deleveraging below 4.0x over the next
