S&P cuts Zayo

S&P said it downgraded all its ratings on Zayo Group Holdings Inc., including the issuer rating to B- from B.

“The downgrade reflects a revision to our forecast to account for weaker profitability in the third quarter of 2022, which will keep S&P Global Ratings-adjusted leverage above 7x through 2024 compared with our previous expectations of about 6.5x,” S&P said in a press release.

The agency said it estimates Zayo’s operating performance should improve in 2023 on healthy booking growth during the year linked with about $18 million in cost savings, a reduction in transaction costs, and the realization of network synergies as more circuits are brought on-network.

The outlook is stable.

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