S&P affirms Suburban Propane

S&P said it affirmed its BB- corporate credit rating on Suburban Propane Partners LP. The outlook is stable.

S&P also affirmed the BB- rating on the company’s senior unsecured notes. The recovery rating on this debt is 4 and indicates an expectation of average recovery (lower end of the 30%-50% range) in the event of a payment default.

Propane volume sales have been significantly lower as a result of record warm temperatures last winter, S&P noted in a news release.

“Though credit metrics are materially weaker than normal, we expect a normalized winter during the upcoming heating season, which could lead to volume sales increasing by over 15% for fiscal 2017, resulting in adjusted leverage improving to about 4.25x,” said S&P credit analyst Mike Llanos in a news release.

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