Nomura Securities Downgrades Central European Distribution (CEDC) to Reduce

Nomura Securities downgraded Central European Distribution (NASDAQ: CEDC) from Neutral to Reduce, price target cut from $8.00 to $0.00.

Nomura analyst, Edward Mundy, said, "Following publication of the Q3 Form 10-Q, we have re-assessed our modelling assumptions and see a structurally challenged business model with a financial structure that is over-stretched. We see continued volatile trading conditions in Russia and Poland, a likely further miss with Q4 results in March 2012 and evidence of a structurally lower margin base. Although we believe the company can meet its near-term interest and debt repayments and there are no covenants on existing term loans, given the structurally lower margin base and lack of top-line visibility, we believe it unlikely that the company will be able to successfully refinance USD 300m debt repayable in 2013. With low visibility on the earnings outlook and a likely miss with full-year results, we would be selling the stock."

For an analyst ratings summary and ratings history on Central European Distribution click here. For more ratings news on Central European Distribution click here.

Shares of Central European Distribution closed at $3.82 yesterday.

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