S&P cuts Auris Luxembourg II

S&P said it downgraded Auris Luxembourg II Sarl (WS Audiology) to B from B+ citing delays in the company reducing its debt after its merger.

“WS Audiology's S&P Global Ratings-adjusted leverage is unlikely to decrease below 7x by 2021 because profitability will remain negatively affected by ongoing restructuring costs and investments, an unfavorable portfolio mix and macroeconomic headwinds this year,” said S&P in a press release.

The outlook is negative.

Moody's downgrades Carlson Travel

Moody's Investors Service said it downgraded Carlson Travel, Inc.'s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD. Concurrently, Moody's affirmed the B2 ratings of the company's senior secured fixed- and floating-rate notes and downgraded its senior unsecured notes to Caa2 from Caa1. The outlook was changed to negative from stable.

The downgrade to B3 and negative outlook reflects Moody's expectation for severe disruptions within the global corporate travel sector in the first half of 2020 due to the Coronavirus (Covid-19) outbreak that will greatly impact Carlson Travel's operating results and weaken its liquidity.

Global airline and hotel bookings have dropped sharply and could remain weak for the remainder of 2020. Given that Covid-19 hasn’t been contained, there are downside risks that demand for corporate travel will remain weak for the entirety of 2020 and the company's earnings could decline in the double-digit percentages, the agency said.

Moody's lowers Cassini

Moody's Investors Service said it downgraded the corporate family rating of Cassini SAS, the ultimate parent of Comexposium Holding to B3 from B2 and its probability of default rating to B3-PD from B2-PD. Moody's also downgraded to B3 from B2 the rating of the €597 million senior secured term loan B due 2026 and the €90 million senior secured revolving credit facility due 2025. The outlook remains negative.

"The downgrade reflects our expectation of a deterioration in Compexposium's operating and financial performance driven by the cancellations and postponements of trade and exhibition shows over the next two quarters owing to the coronavirus outbreak in its main European markets," said Víctor García Capdevila, a Moody's assistant vice president and lead analyst for Cassini, in a press release.

"Comexposium was already weakly positioning in the previous B2 rating category and the operational disruptions that the company will endure over the next few months will lead to a significant increase in leverage. We now expect that Comexposium's Moody's-adjusted gross leverage will increase to around 8x by the end of 2020 compared with our previous expectation of 5.9x," he added.

Moody's lowers L Brands

Moody's Investors Service said it downgraded all ratings of L Brands, Inc. including its corporate family rating to Ba3 from Ba2 and its probability of default rating to Ba3-PD from Ba2-PD.

The agency also downgraded the company's senior unsecured guaranteed notes to Ba3 from Ba2 and the senior unsecured unguaranteed notes to B2 from B1. The speculative grade liquidity rating remains SGL-2. The outlook is stable. This rating action concludes the review for downgrade started on Dec. 17.

"Although the divestiture of Victoria's Secret will enable L Brands to focus on the growth of its stronger brand, Bath & Body Works, its platform will be less diversified and certain dis-synergies and execution risk will be faced, " said Christina Boni, a Moody's vice president, in a press release. "The lack of concept diversification is mitigated by Bath & Body Works' consistent operating performance and its planned reduction of debt."

S&P cuts Momentive Performance

S&P said it downgraded the ratings for Momentive Performance Materials Inc. and its senior secured credit facility to B+ from BB-. The 3 recovery rating remains unchanged, indicating expectations for a meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a payment default.

“The downgrade follows Momentive's significantly weaker performance in 2019 and our expectation that its EBITDA and credit metrics will remain relatively flat in 2020. The company has seen a significant decrease in EBITDA through the first nine months of 2019, which we expect to continue for the full year. This will likely cause 2020 to be weaker than we previously expected,” said S&P in a press release.

The outlook is negative.

Fitch ups Viasat notes

Fitch said it upgraded the rating on Viasat, Inc.'s $700 million of senior unsecured notes due 2025 to BB-/RR3 from B/RR5 owing to higher recovery prospects stemming from Viasat's strong financial performance over the past year. The senior secured debt (the Ex-Im facility) under Viasat Technologies Ltd. was previously rated by Fitch under Viasat. Fitch corrected the issuer of this facility to Viasat Technologies.

Also, Fitch changed the outlook to positive from stable. The positive outlook recognizes the company's strong financial performance relative to Fitch's positive financial metric sensitivities, the agency said.

Fitch affirmed the company’s B+ rating and assigned a B+ rating to Viasat Technologies.

S&P puts Carlson Travel on watch

S&P said it placed the ratings for Carlson Travel Inc. on CreditWatch with negative implications.

“The CreditWatch placement reflects Carlson Travel's vulnerability to declining demand for air travel and hotels due to the Covid-19 pandemic and the limited information on how widespread and drawn out the impact will be. Companies have increasingly imposed restrictions on their employees' nonessential travel over the course of February and March, which has led to the cancellation or postponement of numerous conferences in the first quarter of 2020,” said S&P in a press release.

S&P said that in resolving the CreditWatch it will evaluate new information concerning the spread of the virus and its effect on Carlson’s operating performance, liquidity and cash flows.

S&P changes Disney view to negative

S&P said it revised the outlook for the Walt Disney Co. to negative from stable citing event cancellations and travel restrictions.

“Disney is exposed to the coronavirus through advertising, film studios and its theme parks. The coronavirus global pandemic is finally starting to meaningfully affect the U.S., following a period of growing contagion outside the U.S. Numerous live events across the country have been recently postponed or cancelled,” said S&P in a press release.

The negative outlook reflects the increased uncertainty around the effect of the coronavirus crisis on the global economy and specifically how it could affect Disney's ability to reduce its leverage to under 2.5x by the end of fiscal 2021 as previously expected.

S&P affirmed Disney’s A ratings.

S&P puts Hawaiian Holdings on watch

S&P said it placed the ratings for Hawaiian Holdings Inc. on CreditWatch with negative implications.

Hawaiian suspended its routes to South Korea and is delaying its planned capacity expansion to Japan. “Over time, we also expect the company to reduce capacity on its domestic routes between the continental U.S. and the Hawaiian Islands. Although the company should also benefit from lower fuel prices, we do not believe the reduced capacity and cost savings will be adequate to offset sharply lower traffic,” said S&P in a press release.

“We expect to resolve the CreditWatch placement when we have more information regarding the degree and timing of the return of passenger travel. If we expect that FFO to debt is likely to average below 25% over the 2020-2021 period, we would likely lower the ratings,” the agency said.

S&P puts MRC Global (US) on watch

S&P said it placed its ratings for MRC Global (US) Inc. on CreditWatch with negative implications.

“We believe MRC's leverage may increase this year because depressed oil prices will likely lead its customers to further reduce their capex budgets and spending in 2020 and 2021. Oil prices plummeted following the announcement that OPEC+ and Russia failed to agree to further production cuts following a significant drop in global demand due to the spread of the coronavirus,” said S&P in a press release.

S&P plans to resolve the placement in the next couple of months after it gets some clarity around how the recent oil price decline will affect its customers' spending budgets and demand.

S&P puts NEP/NCP on watch

S&P said it placed all its ratings for NEP/NCP Holdco Inc. on CreditWatch with negative implications.

“The CreditWatch placements reflect the company's direct exposure to major televised live events that are currently being affected by the COVID-19 outbreak. These disruptions could hurt operating performance, increasing adjusted leverage above our mid-6x threshold on a sustained basis. The CreditWatch placements also reflect our view that prolonged delays or outright cancellations of these events could further deteriorate NEP's liquidity, potentially affecting the sustainability of its capital structure,” said S&P in a press release.

S&P said it expects to resolve the CreditWatch within the next 90 days to assess the possibilities for further delays and disruptions of major events later this year, including the Olympics.

S&P removes Taylor Morrison from watch

S&P said it removed the ratings for Taylor Morrison Home Corp. from CreditWatch with negative implications, where they were placed in November. Last month, the company completed the acquisition of William Lyon Homes.

The agency affirmed the BB issuer and issue ratings. The recovery rating on the company’s notes is unchanged at 3, which indicates an expectation for a meaningful (50%-70%; rounded estimate: 65%) recovery. S&P assigned the exchange notes a BB rating.

The outlook is negative.

Moody's changes LPL outlook to stable

Moody's Investors Service said it changed the outlook for LPL Holdings, Inc. to stable from positive and affirmed the company’s Ba2 corporate family rating, Ba1 senior secured term loan and revolving credit facility and B1 senior unsecured notes.

The change in outlook to stable reflects Moody's expectation lower interest rates and asset prices will slow the pace of revenue growth at LPL. However, Moody's said the firm's credit profile remains well-positioned at its current rating levels because of several credit positive strategic and financial policies that LPL has adopted over the last two years.

Moody's sinks Foresight Energy

Moody's Investors Service said it downgraded Foresight Energy, LLC's probability of default rating to D-PD from Caa2-PD and corporate family rating to C from Caa2. Moody's also downgraded the company's first-lien senior secured credit facilities to C from Caa1 and second-lien senior secured notes to C from Caa3.

The action follows Foresight's announcement on Tuesday the company entered into a voluntary support agreement with more than 70% of its lenders and filed voluntary petitions to initiate Chapter 11 bankruptcy proceedings in the U.S. Bankruptcy Court for the Eastern District of Missouri. The action concludes the review for downgrade initiated on Oct. 1.

Moody's will withdraw all of Foresight Energy, LLC's ratings due to the bankruptcy filing.

S&P cuts Carnival

S&P said it downgraded Carnival Corp. and its unsecured debt two notches to BBB from A-, and they remain on CreditWatch with negative implications.

“The downgrade reflects a significant anticipated loss of revenue and cash flow at least in 2020 compared to our prior base-case estimates, stemming from a rapid decline in consumer sentiment toward travel and cruises in the face of the coronavirus pandemic. Additionally, expanding travel restrictions, quarantines, and a wave of public gathering closures and advisories make it increasingly difficult and less desirable for consumers to travel, at least over the near term,” said S&P in a press release.

Furthermore, S&P sees a rising chance of a recession stemming from the pandemic that could pressure consumer discretionary spending on travel this year, which would slow recovery once it is contained.

Fitch trims Jackson National

Fitch Ratings said it downgraded the long-term issuer default rating of Jackson National Life Insurance Co. to A from A+. The outlook is negative. The downgrade follows Prudential's announcement it will pursue a minority initial public offering of its Jackson National's U.S. operations.

Proceeds would be redeployed as growth capital into the company's operations, as it seeks to further accelerate its growth and diversification strategy.

Fitch also affirmed Prudential plc's IDR at A. The outlook for Prudential is stable.

Fitch places Boeing on watch

Fitch Ratings said it placed the ratings for the Boeing Co. and Boeing Capital Corp. on rating watch negative, reflecting the effect coronavirus is having on the aviation sector.

This new risk combines with the ongoing risks related to the timing of the return-to-commercial service of the 737 MAX. These concurrent risks could influence the pace of the 737 MAX delivery to ramp-up after the grounding is lifted, which could slow the rate of debt reduction from peak debt levels, which will be higher than Fitch had previously expected.

Fitch rates both companies A-.

Fitch revises Eastman Chemical view negative

Fitch Ratings said it affirmed Eastman Chemical Co.'s long-term issuer default rating and senior unsecured debt ratings at BBB but revised the outlook to negative from stable.

“The negative outlook reflects the company's historical and forecast financial profile, which is above tolerances for the rating. The company has not achieved its 2.5x total debt/EBITDA goal, and exposure to the automotive, consumer durable and construction markets could make this goal challenging to achieve in the current macroeconomic environment without a shift in capital allocation,” said Fitch in a press release.

Moody's rates Zimmer Biomet notes Baa3

Moody's Investors Service said it assigned a Baa3 rating to Zimmer Biomet Holdings, Inc.'s proposed senior unsecured note offering.

Proceeds will be used to repay at maturity a portion of the $1.5 billion senior unsecured notes maturing on April 1, which are also rated Baa3. The transaction is credit positive, as it will extend the company's debt maturity profile. All of Zimmer Biomet's ratings remain unchanged and the outlook remains stable.

Moody's changes Prudential view downward

Moody's Investors Service said it affirmed Prudential plc's long-term credit ratings and changed the outlook to negative from stable.

The negative outlook on Prudential reflects the diminished diversification benefits following completion of the planned minority initial public offering of Jackson National Life Insurance Co. to the group's earnings, cash flows and capital, as well as uncertainty regarding the importance of the U.S. operations to Prudential group in the longer-term.

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