S&P turns Aramark view to negative

S&P said it changed Aramark’s outlook to negative from stable and affirmed its BB- issuer credit rating on the company.

“The recent negative virus developments could derail Aramark's performance recovery if perceived risks escalate. Compared to earlier this year when prospects improved because vaccines were being distributed and the economy began to reopen, the outlook has become more tenuous. The emergence of mutations in the U.S. including the delta variant, and reports of waning vaccine efficacy–which will likely require booster shots–has in our opinion at least temporarily eroded consumer confidence,” the agency said in a press release.

S&P noted the company’s business is depends heavily on social gathering, away-from-home food environments and are highly susceptible to outbreaks.

“At this point, we have not materially altered our forecast and believe the company can strengthen profitability and reduce adjusted leverage to around 5x by Sept. 30, 2022, if virus conditions do not worsen,” the agency said in a press release.

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