S&P pares Staples

S&P said it lowered all its ratings on Staples Inc., including the issuer rating to B- from B.

“Staples hasn't seen a significant recovery in sales and profits relative to our expectations. While Staples experienced some recovery in performance in previous quarters, second quarter 2023 results were hurt by weaker demand for technology and promotional products as well as higher costs. As a result, sales were at the lowest level since the fourth quarter 2021, and we now anticipate almost flat sales for fiscal 2023 (ending January 2024) relative to 2022,” S&P said in a press release.

S&P said it believes that Staples’ debt to EBITDA will be sustained above 7x, compared with its previous forecast of below 7x.

The outlook is negative.

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