S&P: American Achievement view negative

Standard & Poor's said it revised the outlook on American Achievement Corp. to negative and affirmed the company's senior secured second-lien notes due 2016 at B. The recovery rating is 4, indicating expectation of 30% to 50% recovery.

"The outlook revision and the B corporate credit rating reflect our expectation that American Achievement's ongoing unfavorable revenue and EBITDA trends will continue to cause the company's debt leverage to remain high and could further weaken its interest coverage and discretionary cash flow over the next several quarters," S&P analyst Chris Valentine said in a statement.

The negative outlook reflects expectation of continued pressure on revenue and profitability over the near-to-intermediate term, as well as concern that the interest coverage could weaken further to the low-1x area, the agency noted.

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