S&P cuts Shearer's

Standard & Poor's said that it lowered the corporate credit rating on Shearer's Foods Inc. to B- from B.

The outlook is developing.

S&P also lowered the issue-level rating on Shearer's senior secured credit facility to B- from B. The recovery rating remains at 3, indicating the expectations for meaningful (50%-70%) recovery in the event of a payment default.

The downgrade reflects Shearer's weaker-than-expected operating performance and the belief that covenant cushion levels will be very tight for the quarter ending March 31, the agency said.

The ratings further reflect the opinion that Shearer's financial profile is highly leveraged given its significant debt burden and less-than-adequate liquidity as well as the view that the company has a vulnerable business risk profile due to its narrow product focus, relatively high customer concentration and limited international presence, 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.