Is it Fin?
Beleaguered handset maker Nokia has been further downgraded by rating agency Fitch, giving it a BB- score and putting its credit worthiness a step closer to junk status. The rating agency says it’s not persuaded that Nokia can pull out of its revenue nosedive.Earlier this week the Finnish manufacturer slashed the cost of flagship Lumia 900 smartphone to just $49.99 (£32) in the US in bid to stem losses, but its share price remains in freefall.
Fitch contends that Nokia’s last quarter earnings confirmed it was unable to achieve even single digit profit margins and there was little hope for the future.
Nokia in turn has retaliated that its gross and net cash position is higher than a year ago while it still has access to €o1.5 billion credit facility.
Yesterday Nokia posted heavy second-quarter losses though, ironically, the shares perked up marginally after it revealed that any turnaround wouldn’t be held back by lack of ready cash.
In recent days rival rating agencies Standard & Poor and Moody’s have similarly downgraded Nokia.
Formerly the world’s biggest handset maker, Nokia is struggling for survival as it undergoes a massive restructuring process to return to profitability on the back of its latest Lumia smartphones based on Microsoft’s Windows platform.
Earlier today Nokia shares were down 7.1 per cent to € 1.43, a much greater fall than the 1.9 per cent decline in the general Helsinki market.