Moody’s changes Latham view to negative

Moody’s Investors Service said it revised its outlook for Latham Pool Products, Inc. to negative from stable.

“Today’s outlook change to negative reflects Latham’s high financial leverage and the elevated downside risks given the ongoing pool industry downturn," stated Oliver Alcantara, a Moody's AVP and analyst, in a press release.

"The meaningful demand headwinds affecting discretionary products with significant declines in pools starts this year will make it challenging for Latham to improve credit metrics, however, the company's good liquidity supported by an undrawn $75 million revolver due 2027 provides financial flexibility to fund business seasonality over the next 12 months," Alcantara added.

The agency also affirmed Latham’s B1 corporate family rating, B1-PD probability of default rating and B1 rating on the company's senior secured first-lien credit facility. The first-lien credit facility consists of a $75 million first-lien revolver due 2027 and $325 million original principal amount first-lien term loan due 2029. The company's SGL-2 speculative grade liquidity rating is unchanged.

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