Moody's cuts Source Media, Accuity

Moody's Investors Service said it downgraded Source Media Inc. and Accuity Inc.'s corporate family to B2 from B1, probability-of-default ratings to B3 from B2 and senior secured credit facility ratings to B2 (LGD3, 34%) from B1 (LGD3, 34%).

The outlook remains negative.

The downgrade to B2 reflects a shortfall in the combined companies' revenue and earnings compared with expectations, resulting in financial leverage of 6.1x at June 30, according to the agency.

Source Media's flagship brands, American Banker and Bond Buyer, continue their leadership in the banking and capital markets niche markets but, along with other brands, have been significantly affected by financial service companies' reduced spending on advertising and subscriptions during the recent economic downturn, the agency noted.

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