S&P lifts Genesco

Standard & Poor's said it raised the corporate credit rating on Genesco Inc. to BB from BB-.

The outlook is stable.

The upgrade reflects performance over the past year that exceeded the forecast due to on-trend merchandising and the acquisition of Schuh Group Ltd., S&P said.

It also incorporates a view that credit metrics, which strengthened over the past 12 months due to EBITDA expansion, will continue to improve modestly over the coming year, the agency said.

Nevertheless, the agency said it continues to view the company's business profile as weak due to its participation in the intensely competitive footwear and headwear retailing industry and the substantial fashion risk associated with its large presence in the teenage market.

The main risks to future performance will continue to include significant ability for substitution in the shoe retailing industry and limited organic growth opportunities in the saturated U.S. market, S&P said.

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