S&P upgrades Weight Watchers

S&P said it raised its corporate credit rating on Weight Watchers International Inc. to B+ from B. The outlook is stable.

At the same time, the agency raised the issue-level rating on the company's first-lien credit facilities, consisting of a $150 million revolving facility expiring in 2022 and a $1.54 billion term loan B due in 2024, to BB- from B.

S&P revised the recovery rating to 2 from 3, indicating an expectation of substantial (70%-90%, rounded estimate 85%) recovery in the event of a payment default.

The agency also raised the issue-level rating on the company's $300 million senior notes due 2025 to B from CCC+ and revised the recovery rating to 5 from 6, indicating an expectation for modest (10%-30%, rounded estimate 20%) recovery.

S&P said Weight Watchers' recent performance exceeded expectations as improving membership and retention rates propel profit growth and result in stronger credit measures.

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