We believe that in light of currently difficult industry conditions, a trend of weakening profitability and low top-line growth will continue for U.K.-based retailer Tesco PLC. The decline in Tesco's profitability and difficulties in protecting its U.K. market share, in particular, could in our view lead to a deterioration in its business risk profile. We are revising our outlook on Tesco to negative from stable and affirming our 'A-/A-2' corporate credit ratings on the company. The negative outlook reflects our view that declining profitability and difficult trading conditions could dilute its credit metrics beyond the levels we consider adequate for the current ratings. On July 31, 2012, Standard&Poor's Ratings Services revised its outlook on U.K.-based Tesco PLC (Tesco)
