S&P cuts WCI

Standard & Poor's said it lowered its corporate credit rating on WCI Communities Inc. to BB- from BB.

Concurrently, the rating on roughly $650 million of senior subordinated debt was lowered to B from B+, the agency said.

The outlook remains negative.

The agency said that the downgrades reflect a much steeper-than-anticipated drop in new orders, higher leverage as a result of the company's use of short-term debt to offset a free operating cash flow deficit and, to a lesser extent, continued share repurchase activity.

The lowered ratings are supported by a solid liquidity position that will further benefit from the near-term closing of several residential towers, S&P noted.

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