S&P could lower Empire Today

Standard & Poor's said it placed its ratings on Empire Today LLC, including its B- corporate credit rating and the issue-level rating on its senior secured notes, on CreditWatch with negative implications.

S&P said the CreditWatch placement reflects its view that challenging market conditions could make it difficult for Empire Today to refinance its $150 million senior notes due Feb. 1, 2017. Management has made its most recent interest payment; however, liquidity remains constrained as the agency now considers the notes a use of cash over the next 12 months in its liquidity scenario.

Recent operating performance for the company has improved over the past two quarters, and S&P expects this trend to continue in the fourth quarter, as the company has been able to convert more leads into sales.

For the last trailing 12 months ended Sept. 30, 2015, debt to EBITDA improved to 5.1 times, EBITDA interest coverage strengthened to 1.7 times, and funds from operations (FFO) to debt increased to 8.3%.

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