S&P lowers Cenveo

Standard & Poor's said it lowered its ratings on Cenveo Inc. and operating subsidiary Cenveo Corp., including its corporate credit rating to B+ from BB-, following the company's announcement that EBITDA profitability in the December 2004 quarter would be lower than previous expectations.

Also lowered were Cenveo Corp.'s senior secured rating to BB- from BB, senior unsecured rating to B+ from BB-, and subordinated rating to B- from B.

The outlook is stable.

S&P said the downgrade reflects S&P's belief that over the intermediate term, Cenveo will generate lower profitability and free cash flow levels, as well as report higher debt balance than previously expected. As a result, S&P expects Cenveo's lease-adjusted total debt to EBITDA to increase to about 6.2x in the 12 months ended December 2004 from 5.8x in the previous quarter, and to remain at levels inconsistent with previous ratings over the intermediate term.

The company's liquidity is provided by internally generated cash flow and its $300 million revolving credit facility due 2008.

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