S&P revises SRS outlook to stable

S&P said it revised SRS Distribution Inc.’s outlook to stable from negative.

“We expect the company to maintain solid cash flows over the next 12 months such that the S&P Global Ratings’ adjusted debt leverage is below 6x. We are now revising our prior forecast and believe SRS will be able to maintain leverage below 6x for the next 12 months, barring any debt-financed acquisitions or dividends. Our previous forecast, we expected the company would end fiscal 2020 with leverage in the 6x-6.5x range,” the agency said in a press release.

The agency also affirmed the B ratings on SRS and its senior secured debt with a 4 recovery rating, indicating substantial (30%-50%; rounded estimate 40%) in default. S&P also affirmed the CCC+ issue-level ratings on the unsecured debt with a 6 recovery rating, indicating average (0% to 10%; rounded estimate 0%) recovery in default.

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