Moody’s: Spencer Gifts to negative

Moody's Investors Service said it changed Spencer Gifts LLC's outlook to negative from stable and affirmed all of its ratings, including the B2 corporate family rating, B2-PD probability of default rating and B1 senior secured term loan rating.

Spencer Gifts and Spirit Halloween Superstores LLC are operating subsidiaries of Spencer Spirit Holdings, Inc. and co-borrowers of the company's credit agreements.

Moody’s said the negative outlook reflects the risk that the Spencer Gifts segment will not be able to offset declining mall traffic to generate positive same store sales growth, which would lead to declining segment profitability.

The company has improved product margins over the past several years and is investing in product and merchandising management systems, however the agency said it believes there is elevated risk that the same-store sales declines over the last three quarters will continue given that Spencer Gifts products are discretionary purchases and consumers continue to shift away from mall-based retailers.

© 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.