Moody's affirms Gaylord; outlook negative

Moody's Investors Service said it affirmed the ratings of Gaylord Entertainment Co., and changed the outlook to negative from stable.

The change in outlook to negative reflects Moody's view that the company will be challenged to improve debt protection measures to previously anticipated levels over the intermediate term as economic weakness persists.

Although operating performance is expected to improve as its newest property - the Gaylord National - ramps up, the agency said it believes operating metrics will remain under pressure and the ability to raise average daily rates will become more difficult.

Moody's added that the B2 corporate family rating reflects Gaylord's weak debt protection measures, limited diversification, modest scale, and relatively aggressive growth and acquisition strategy.

Affected ratings include the probability of default rating of B2, $225 million 6.75% senior global notes due Nov. 15, 2014 at Caa1 (LGD 5, 83%), $350 million 8.00% senior global notes due Nov. 15, 2013 at Caa1 (LGD 5, 83%) and speculative-grade liquidity rating of SGL-2.

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