Moody's trims Rodan & Fields

Moody's Investors Service said it downgraded Rodan & Fields, LLC's corporate family rating to Caa2 from B3 and its probability of default rating to Caa2-PD from B3-PD. Moody's also downgraded Rodan & Fields' first-lien senior secured revolving credit facility and term loan to Caa2 from B3. The downgrades conclude the review for downgrade the agency started Jan. 24.

“The downgrade reflects Moody's belief that Rodan & Fields' operating performance and operating cash flow will continue to deteriorate meaningfully over the next 12 months. Weak earnings are pushing financial leverage higher to a point where the capital structure is becoming unsustainable without a meaningful operational turnaround. For the 12 months ending September 2019, the company's debt to EBITDA reached a high of 3.4x and Moody's estimates that debt to EBITDA will be in excess of 5x in 2020,” said Moody’s in a press release.

The outlook is negative.

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