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Moody’s pares PrimeSource
Moody's Investors Service said it downgraded Park River Holdings, Inc.'s (PrimeSource) senior secured first-lien bank credit facility to B3 from B2 and the rating on the senior unsecured notes to Caa2 from Caa1. The agency also lowered the corporate family rating to B3 from B2 and the probability of default rating to B3-PD from B2-PD. Moody’s changed the outlook to stable from negative.
“The downgrade reflects PrimeSource's elevated leverage, which is expected to remain above 6.5x through year-end 2024. Interest coverage, defined as EBITA-to-interest expense, is also expected to remain below 1.5x through year-end 2024. Credit metrics have been pressured due to weaker volumes and earnings levels from declining demand in both new construction and repair & remodeling end markets,” Moody’s said in a press release.
The healthier outlook reflects PrimeSource’s exposure “to the more stable repair & remodeling end market and good overall liquidity profile,” the agency noted.
PrimeSource's outlook is also buoyed by a revenue scale of more than $2.5 billion, solid EBITDA margin, growing market position, and end market diversity, Moody’s said.
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