Standard & Poor’s has downgraded the credit rating of 361 Degrees International, predicting that its position in the Chinese market will weaken due to an accelerated consolidation of the industry, leading its sales to decline by 5 to 10 percent in 2020 and by up to 5 percent in 2021. Despite a comfortable cash balance, 361° has notes of $400 million due in June 2021, and it may have problems with cross-border cash transfers from abroad. Its cash flow will likely fall due to extended payment terms with suppliers and wholesale discounts being offered to distributors. S&P sees the company’s profit margin affected by the growing competition in the industry, although good cost controls should lead to a better-than-expected Ebitda margin of 10 to 12 percent in 2020 and 2021, compared with 13.8 percent in 2019. Still, S&P expects the debt-to-Ebitda ratio to swell to between 4.0 and 4.5 times from 3.3x last year