Moody's lowers Emmis

Moody's Investors Service said it downgraded Emmis Communications Corp.'s corporate family and probability-of-default ratings to B2 from B1, series A cumulative convertible preferred shares to Caa1 (LGD6, 99%) from B3 and speculative-grade liquidity rating to SGL-3 from SGL-2. In addition, Emmis Operating Co.'s $145 million revolver due 2012 and $455 million tranche B term loan due 2013 were lowered to B2 (LGD 4, 50%) from B1.

The outlook is stable.

The agency said the downgrade reflects the company's continued weak operating performance, weaker than previously expected credit metrics and a tightening margin of covenant compliance.

Emmis' ratings reflect the company's increased debt-to-EBITDA leverage of 8.9x due to continued operating challenges, deterioration in the EBITDA margins and significant revenue concentration in the competitive New York and Los Angeles markets, Moody's said.

Emmis' ratings are supported by its strong large-market radio presence and Moody's belief that there is considerable asset value in Emmis' large-market radio stations providing adequate coverage of the company's sizeable debt burden.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.