S&P hikes CEC Entertainment

S&P said it raised CEC Entertainment LLC and its first-lien senior secured notes due 2026 to B- from CCC.

“CEC's operating performance has recovered more rapidly than we previously expected, and we no longer view its capital structure as unsustainable. The company reported a sequential improvement in its sales through July 2021 and its total sales for that month approached 2019 levels. This is a significant improvement from the declining sales it reported during the temporary store closures last year and the slow cadence of its recovery amid the ongoing coronavirus pandemic,” S&P said in a press release.

The agency said it forecasts an increase in CEC's EBITDA with leverage over 7x this year before declining to the mid-5x area next year.

The outlook is stable.

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