Moody’s cuts Checkout, facilities

Moody's Investors Service said it downgraded Checkout Holding Corp.'s (Catalina Marketing Corp.) corporate family rating to Caa1 from B3 and probability of default rating to Caa1-PD from B3-PD.

Additionally, the agency downgraded the first-lien senior secured credit facility consisting of a $100 million revolver due April 2019 and a $1.05 billion term loan due April 2021 to B2 from B1.

The $460 million second-lien term loan due April 2022 was downgraded to Caa2 from Caa1.

The remains negative.

“The downgrade of ratings reflects materially reduced revenue and EBITDA of Checkout as several of its customers in the company's U.S. Established Brands market have reduced their promotional spending dollars with Catalina,” Moody’s said in a news release.

“Moody's believes that major CPG companies have been increasingly moving their promotional spending dollars toward digital channels.”

“Though the company has been working to diversify its revenue streams across its global markets and with new products and solutions, including digital product offerings, that growth has not been able to offset the material decline of in-store promotional spend by its U.S. Established Brands market.”

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