S&P moves Latham outlook to negative

S&P said it changed its outlook on Latham Group Inc. to negative from stable and affirmed all its ratings, including the B+ issuer rating.

“Lower consumer demand and channel inventory destocking caused Latham's S&P Global Ratings-adjusted leverage to increase rapidly to 3.7x as of the 12 months ended April 1, 2023, from 2.5x as of Dec. 31, 2022. In addition, we forecast the company's leverage could increase above our 4.5x downside threshold in the upcoming quarters, as it laps its strong performance during 2022, before improving below 4x by the end of 2023 on a combination of debt repayment and margin stabilization,” the agency said in a press release.

S&P warned of a possible downgrade over the next 12 months if Latham fails to meet expectations because of a more-severe loss in pool installations that drives its leverage above 4.5x and it remains there.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.