S&P: Sprint Industrial view to negative

Standard & Poor’s said it revised the outlook on Sprint Industrial Holdings LLC to negative from stable.

The agency also said it affirmed the company’s B corporate credit rating, along with the B+ rating on the company’s first-lien term loan. The recovery rating on this debt remains at 2, indicating 70% to 90% expected default recovery.

S&P also said it affirmed the CCC+ rating on its second-lien term loan. The recovery rating on this debt remains at 6, indicating 0 to 10% expected default recovery.

The outlook was revised to negative because Sprint’s leverage is likely to remain in excess of 6x in the next 12 months, the agency said.

The company used debt to fund elevated capital spending and an acquisition during 2014 and operating activities were weaker than expected, S&P said.

The company’s operating performance is expected to modestly improve in 2015 as the company grows its safety-equipment rentals business and opens new branches in higher-demand regions, the agency said.

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