S&P cuts Orbitz view to negative

Standard & Poor's said it revised its outlook on Orbitz Worldwide Inc. to negative from stable and affirmed its ratings, including the B corporate credit rating.

The outlook revision is based on the negative outlook on Orbitz's partial owner, Travelport Holdings Ltd., the agency said. Although Travelport reduced its stake in Orbitz in late 2007 and deconsolidated Orbitz's financial results from its own at that time, Travelport and affiliates of the Blackstone Group, one of Travelport's owners, still own 55.5% of Orbitz common stock.

In addition, S&P said it is concerned about weaker demand beginning in the second half of 2008 caused by a slowing global economy, which could negatively affect the company's bookings and in turn hurt the company's earnings and cash flow and delay expected debt reduction.

Ratings on Orbitz reflect an aggressive financial profile and the seasonal and cyclical nature of the travel industry, while also incorporating the company's major position in online travel distribution and the strong cash flow this business typically generates, the agency said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.