S&P downgrades Eastman Kodak

S&P said it lowered the corporate credit rating on Eastman Kodak Co. to CCC+ from B-.

The outlook is negative.

The agency also downgraded the first-lien secured term loan to CCC+ from B-.

The recovery rating is unchanged at 3, indicating 30% to 50% expected default recovery.

In addition, S&P downgraded Eastman Kodak due to the considerable decline in cash balances over the past four years, which have shrunk to $342 million as of Sept. 30 from more than $800 million at the time of the firm's emergence from Chapter 11 bankruptcy in 2013.

Management expects favorable working capital effects to increase cash to the $360 million to $370 million range by the end of the year.

But, the agency said it believes that Kodak's core operations are unlikely to generate meaningful cash over the next 12 to 24 months due to a weakening commercial printing demand environment, an inability to successfully commercialize investments in 3D printing and other advanced materials technology.

There also is a weakening profitability in legacy consumer and film operations, S&P said.

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