S&P affirms AFC

Standard & Poor's said it affirmed its B+ corporate credit rating on AFC Enterprises Inc.

The outlook is stable.

The agency said the affirmation follows the successful amendment of the company's senior secured credit facility, giving AFC Enterprises greater financial flexibility. Among other things, the amendment extended the maturity of both the revolver and term loan and provided covenant relief in the near term.

The ratings on AFC Enterprises reflect its participation in the intensely competitive chicken quick-service restaurant industry, its likely limited sales and profit growth opportunities and its aggressively leveraged capital structure, S&P said.

Going forward, AFC may see low single-digits improvement in same-store sales because of its continued marketing efforts and value promotions and because it is largely comparing against declines in same-store sales in the last two years, the agency predicted.

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