S&P: CompuCom view to negative

S&P said it revised the outlook on CompuCom Systems Inc. to negative from stable and affirmed the B- corporate credit rating.

The agency also said it affirmed the B- rating with a recovery rating of 3 on the company’s senior secured term loan due 2020. The 3 recovery rating indicates 50% to 70% expected default recovery.

S&P also said it affirmed the CCC issue-level rating with a recovery rating of 6 on the company’s $225 million senior unsecured notes due 2021. The 6 recovery rating indicates 0 to 10% expected default recovery.

The outlook revision reflects CompuCom’s weaker-than-expected first-quarter results, along with expected further weakness in financial metrics as it goes through a challenging and necessary business model transition over the next 12 months, the agency said.

In this first quarter, the company reported a revenue decline of 11% as compared to first quarter of 2015, along with negative free cash flow of about $25 million, S&P said.

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