S&P lowers ProfMedia view to negative

Standard & Poor's said it revised the outlook on ProfMedia Ltd. to negative from stable.

S&P also affirmed the long-term corporate credit rating at B+, along with the B+ rating on the RUB 3 billion bonds issued by ProfMedia-Finance LLC and fully guaranteed by ProfMedia.

The recovery rating on this debt remains 4, indicating 30% to 50% expected recovery in a default.

The outlook revision reflects ProfMedia's worsening liquidity position due to its forthcoming debt maturities of about RUB 4.3 billion, including a RUB 2.7 billion bond with a put option in July 2013, S&P said.

The company is facing significant maturities in 2013, which are unlikely to be refinanced out of its free operating cash flow, the agency said. It also has no available external committed credit lines, S&P added.

Although the upcoming debt maturities are considered a potential source of risk, the agency said it affirmed the ratings because it believes ProfMedia has the ability to secure the necessary refinancing, which the company is currently working on.

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