S&P ups Salem Media

S&P said it upgraded Salem Media Group Inc. and its senior secured notes to CCC+ from CCC.

“We believe Salem will have sufficient sources of liquidity to cover its cash uses over the next year. Salem had cash balances of $6.3 million as of Dec. 31, 2020, and we expect cash on the balance sheet to increase further through the company's first quarter due to proceeds from government loans. In January 2021, Salem applied for $11.2 million in PPP loans. It has already received proceeds of $8.4 million, with the remainder expected in the coming weeks,” the agency said in a press release.

S&P does not see the 1x minimum fixed-charge ratio covenant to spring in 2021, but headroom remains tight. The covenant on the ABL facility applies if availability is less than $4.5 million, but current cash on the balance sheet and the PPP loans should prevent that, the agency said.

The outlook is stable.

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