Moody’s rates Great Canadian revolver Baa3

Moody’s Investors Service said it assigned a Baa3 (LGD 1) rating to Great Canadian Gaming Corp.’s amended and extended C$350 million senior secured revolving credit facility due 2020.

Moody’s also said it assigned an SGL-1 speculative grade liquidity rating to the company.

Great Canadian’s Ba3 corporate family rating and Ba3-PD probability of default rating also were affirmed, along with the B1 (LGD 4) rating on its C$450 million senior unsecured notes due 2022.

The outlook remains stable.

The ratings reflect the company’s strong credit metrics tempered by its small size and the potential for increased debt to fund growth projects, Moody’s said.

The ratings reflect the company’s leading market position, substantial barriers to entry in the regulated Canadian gaming market, eligibility for capital-spending reimbursement programs in British Columbia and Nova Scotia and modest leverage with an adjusted debt-to-EBITDA ratio of 2.6x at the end of the first quarter 2015, the agency said.

The ratings also consider the company’s relatively small revenue size, limited diversity and declining revenue and EBITDA trends at certain facilities, Moody’s said.

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