Moody's may cut ICON Health

Moody's Investors Service said it placed the ratings of ICON Health & Fitness Inc. on review for possible downgrade due to the company's weak recent financial performance, as reflected by steep declines in gross and operating margins, declining free cash flows from operations and an increase in debt levels.

On review for possible downgrade are the company's $155 million 11.25% senior subordinated notes due 2012, rated B3; senior implied rating of B1; and senior unsecured issuer rating of B2.

Moody's said its review for possible downgrade will focus on whether the company can improve on its recent weak financial performance despite a number of significant challenges.

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