S&P cuts Adani Abbot Point

S&P said it downgraded Adani Abbot Point Terminal Pty Ltd. to BB+ from BBB- and placed the ratings on CreditWatch with negative implications.

The CreditWatch with negative implications reflects heightened liquidity risks pending repayment of the May 2020 maturity. Although Adani issued a prepayment notice for April 17, to holders of the A$100 million notes due May 2020, this money is not yet in a secure account and the nature of the funding is unknown, the agency said.

“We may remove the rating from CreditWatch upon repayment of the bonds on April 17 as per the terms of the prepayment notice. Any change in the rating will also take into account the project's steps to address the November 2020 maturity,” S&P said in a press release.

Moody's cuts Del Monte Foods

Moody's Investors Service said it downgraded ratings of Del Monte Foods, Inc., including its corporate family rating to Caa2 from Caa1, probability of default rating to Caa2-PD from Caa1-PD, first-lien senior secured debt to Caa2 from Caa1 and speculative grade liquidity to SGL-4 from SGL-3. Finally, Moody's revised the outlook to negative from positive.

The rating actions stem from the company's unexpected cancellation of a proposed $575 million senior secured notes offering due to unfavorable market conditions caused by coronavirus-related disruptions. The previously assigned Caa2 instrument rating has been withdrawn.

The canceled notes offering was part of a proposed recapitalization designed to reduce financial leverage and address major near-term debt maturities, including its primary liquidity facility, which expires in November. As of the third quarter ended January, based on Moody's estimates and adjustments, debt/EBITDA was about 12.2x.

S&P cuts Libbey

S&P said it downgraded the ratings on Libbey Inc. and its senior secured term loan to CCC from B-. The agency revised the recovery rating to 4 from 3. The 4 rating indicates the agency’s expectation for average (30%-50%; rounded estimate: 45%) recovery in the event of a payment default. “We lowered the rating to indicate our belief that the lenders will receive less recovery given the decline in the company's equity value,” S&P said in a press release.

“The downgrade reflects Libbey's constrained liquidity position and heightened refinancing risk. We no longer expect the company to be able to address its upcoming term loan B maturity before it becomes current on April 9, 2020, due to market volatility stemming from the spread of the coronavirus. Therefore, we believe the company's liquidity position has become constrained. This leads us to anticipate that Libbey may default over the next 12 months,” the agency said.

The outlook is negative.

Moody's downgrades Live Nation

Moody's Investors Service said it downgraded Live Nation Entertainment, Inc.'s corporate family rating to Ba3 from Ba2, probability of default rating to Ba3-PD from Ba2-PD, senior secured credit facilities ratings to Ba2 from Ba1 and senior unsecured notes ratings to B1 from Ba3 and changed the outlook to negative from stable. The speculative grade liquidity rating was maintained at SGL-1.

"The downgrade reflects expectations that the postponements or cancellations of live events associated with the spread of the coronavirus will materially weaken Live Nation's financial results and credit metrics in 2020", said Peter Adu, a Moody's vice president and senior analyst, in a press release.

"The negative outlook signals the potential for further rating changes if the coronavirus outbreak impacts demand for live entertainment in the busy summer months and onwards," Adu added.

Moody's cuts Occidental Petroleum

Moody's Investors Service said it downgraded Occidental Petroleum Corp.'s senior unsecured rating to Ba1 from Baa3. Moody's also assigned Occidental a corporate family rating of Ba1, a probability of default rating of Ba1-PD and a speculative grade liquidity rating of SGL-3. Ratings were placed on review for downgrade.

"Occidental Petroleum's August 2019 acquisition of Anadarko Petroleum Corporation (Anadarko) continues to burden the company's balance sheet with over $35 billion of debt and $10 billion of preferred stock, significantly compromising its financial flexibility to confront the collapse in oil prices," said Andrew Brooks, a Moody's vice president, in a press release.

"While OXY has made progress capturing acquisition synergies, and is itself a low-cost operator with attractive Permian Basin acreage, projected asset sales required for debt reduction have slowed and face considerable headwinds in a challenged oil and natural gas price environment, leaving OXY with a significantly weakened credit profile whose prospects for near-term improvement are uncertain," Brooks said.

S&P trims Party City

S&P said it downgraded Party City Holdings Inc. to CCC+ from B, lowered the term loan to B- from B+ and cut the rating on the senior notes to CCC- from CCC+. The 2 recovery rating on the notes is unchanged.

“The downgrade reflects our view that Party City's operating prospects this year are substantially worsened by the coronavirus pandemic, following a weak fourth quarter which highlights ongoing operational challenges faced by the company. Therefore, we believe it is increasingly likely that Party City will face difficulty in refinancing its debt at par,” said S&P in a press release.

The outlook is negative.

Moody's downgrades SAS

Moody's Investors Service said it downgraded SAS AB's probability of default and corporate family rating by one notch to B2-PD and B2 from B1-PD and B1 respectively. The subordinated rating was downgraded to Caa1 from B3. The outlook has been changed to ratings on review from stable.

The downgrade was prompted by the drastic decline in passenger traffic since the outbreak of coronavirus started during January 2020, which will result in a significant negative free cash flow in 2020, a weakening liquidity profile and significantly higher leverage, the agency said.

Fitch downgrades Solocal

Fitch Ratings said it downgraded Solocal Group's long-term issuer default rating to C from CCC+ and senior secured notes maturing on March 2022 to CC/RR3 from B-/RR3.

The downgrade reflects a material increase in the risk of default by Solocal as it has entered into a grace period following its failure to pay its bond coupon that was due March 15. Fitch expects the company to enter into talks with bondholders to negotiate a waiver or a standstill agreement on the payments due for the rest of 2020.

“We believe that the minimal liquidity headroom available to the company could be worsened by lower digital order intakes and by the deterioration of working capital due to the coronavirus crisis,” said Fitch in a press release.

Moody's downgrades SoLocal

Moody's Investors Service said it downgraded the corporate family rating of SoLocal Group SA to Caa3 from Caa1 and its probability of default rating to Ca-PD from Caa1-PD. Concurrently, Moody's downgraded the rating on the €398 million senior secured notes due 2022 to Ca from Caa2. The outlook remains negative.

Moody's said it downgraded SoLocal to Caa3 following the company's decision to suspend the €10 million quarterly coupon payment on the euro notes that was due Monday.

If the company does not pay the coupon before the end of the 30-day grace period, Moody's will consider this as a default. In this event, Moody's said it expects to assign an /LD to the PDR at that time.

Moody's downgrades TAP

Moody's Investors Service said it downgraded the probability of default and corporate family ratings of Transportes Aereos Portugueses, SA to Caa1-PD and Caa1 from B2-PD and B2 respectively. Concurrently the agency downgraded the instrument rating assigned to €375 million of senior unsecured notes to Caa1 from B2. The outlook is negative.

The downgrade was prompted by the very sharp decline in passenger traffic since the coronavirus outbreak started in January, which will lead to significant negative free cash flow in 2020, a weakening liquidity profile and significantly higher leverage. “TAP's previous ratings were based on the expectation of improvement of credit metrics and free cash flow generation, which is no longer feasible,” the agency said in a press release.

Moody's downgrades TUI

Moody's Investors Service said it downgraded the corporate family rating of TUI AG to B2 from Ba3. Concurrently, the senior unsecured rating was downgraded to B2 from Ba3 and the probability of default rating was downgraded to B2-PD from Ba3-PD. Moody's also placed the company's ratings on review for further downgrade.

“Our decision to downgrade TUI's ratings reflects the company's announcement of the temporary suspension of the vast majority of TUI's operations until further notice due to the unprecedented spread of the coronavirus (Covid-19). We expect this will significantly impact TUI's earnings in fiscal 2020 and its cash outflow will be much higher than previously anticipated,” said Vitali Morgovski, a Moody's assistant vice president, analyst and lead analyst for TUI, in a press release.

S&P lowers Tui AG

S&P said it downgraded its ratings for Tui AG and its senior unsecured debt to B- from BB-. The recovery ratings on the senior unsecured facilities are now 3, with a 60% estimated recovery. The agency placed the ratings on CreditWatch with negative implications.

“The spreading of coronavirus in Europe is severely affecting holiday bookings from European customers, and we believe that in the next few months, bookings could be 50% below the levels seen last year. Travel restrictions have been introduced in several countries, such as Turkey's ban on travelers from Europe.

On Sunday, Tui decided to suspend the majority of tour operations until further notice. It withdrew its earnings guidance for the year and decided to apply for state aid, S&P said.

Moody's trims Washington Prime

Moody's Investors Service said it downgraded all of Washington Prime Group Inc.'s ratings, including the ratings of its operating subsidiary, Washington Prime Group, LP's senior unsecured debt to Caa1 from B1. At the same time, Moody's placed the ratings, except the speculative grade liquidity rating, under review for downgrade. The speculative grade liquidity rating was downgraded to SGL-4 from SGL-3.

“The rating downgrade reflects our expectation of continued weak performance from WPG's mall portfolio amidst an increasingly challenging operating environment. The REIT's high leverage and weak liquidity position, including the potential for it to breach its debt covenants, are additional credit considerations,” the agency said in a press release.

Moody's said its review will consider the cash flow risk associated with the REIT's mall portfolio, including its effect on leverage and prospects for remaining in compliance with its debt covenants.

S&P cuts World Acceptance

S&P said it lowered its issuer credit rating on World Acceptance Corp. to B- from B. The outlook is negative.

“The downgrade follows World Acceptance Corp.'s recent additional accrual for the investigation into its (former) Mexico operations – resulting in an aggregate accrual of $21.7 million. Following the company's decision to increase debt under its revolving credit facility to $583.7 million as of Dec. 31, 2019, from $251.9 on March 31, 2019, it will have substantially higher interest expenses,” said S&P in a press release.

Fitch changes Air Canada view to negative

Fitch Ratings said it affirmed the issuer default rating of Air Canada at BB and revised the outlook to negative from stable.

The revision is based on the sharp drop in demand due to the Coronavirus. North American airlines are reporting steep and broad-based declines in passenger numbers since the virus began to appear widely outside of China. Fitch believes Air Canada will return to credit metrics that are supportive of the BB rating by the end of 2021.

S&P shifts Colfax view to negative

S&P said it revised the outlook for Colfax Corp. to negative from stable and affirmed the company’s BB+ ratings.

The negative rating outlook reflects S&P’s view there is at least a one in three chance the company maintains leverage in the 4x area or above over the next year.

“While we believe the company is better positioned than it was historically given its medical exposure, we believe its FabTech business remains cyclical and exposed to market volatility,” said S&P in a press release.

Fitch changes Delta view to negative

Fitch Ratings said it affirmed the issuer default rating for Delta Air Lines at BBB-, and revised its outlook to negative from stable.

The negative outlook is based on the sharp drop in demand occurring in the market due to the widespread effect on demand from the coronavirus. Fitch said its current forecast for Delta anticipates the company will be able to return to credit metrics that support the BBB- rating in 2021.

S&P puts New Home on watch

S&P said it placed its ratings, including the B- issuer rating, of the New Home Co., Inc. on CreditWatch with negative implications.

“The CreditWatch listing reflects our expectation that the upcoming maturity of New Home's revolver may affect its ability to fund its near-term obligations and overall liquidity position. In addition, it is our belief that New Home will face headwinds in favorably extending or refinancing its bank facility, which became current this month,” said S&P in a press release.

The agency plans to evaluate the company's near-term results in light of any new bank agreement, while also taking into consideration forecasted results at that time. “We expect to resolve the CreditWatch within 90 days,” S&P said.

S&P changes Sinclair Broadcast view to negative

S&P said it revised the outlook for Sinclair Broadcast Group to negative from positive and affirmed its BB- rating on the company.

The negative outlook on Sinclair reflects the uncertainty around the extent of coronavirus' effect on the company's performance and its ability to reduce its leverage comfortably below 5.5x over the next year, the agency said.

S&P puts Universal Entertainment on watch

S&P said it placed its BB- long-term issuer credit rating Universal Entertainment Corp. and its BB-senior secured debt rating for the company on CreditWatch with negative implications.

The CreditWatch placement follows the company's announcement on Monday it suspended operations at its Okada Manila casino resort complex near the Philippine capital from March 15 to April 14. “It also reflects our view that its profit is likely to fall materially if the global Covid-19 pandemic persists and the company extends the suspension, leading to a substantial delay in the recovery of its financial health,” said S&P in a press release.

S&P said it plans to resolve the CreditWatch placement within 90 days after examining the effect of the suspension of its casino operations and outlook for the operational performance of the entire company, including the gaming machine business.

Fitch revises Ethias's outlook to stable

Fitch Ratings said it revised Ethias SA's outlook to stable from positive. Fitch also affirmed Ethias' issuer default rating at BBB+.

The outlook change is based on the significant uncertainty created by the global Covid-19 pandemic, which has resulted in high levels of volatility in capital markets. This, in turn, has resulted in a sharp drop in interest rates, as well as significant variability in stock, bond and derivative prices as well as a heightened risk of credit events.

The combination will likely create some pressure on earnings and variability in capital levels of European life and composite insurers, the severity and duration of which is impossible to predict. Fitch believes these conditions no longer support a positive outlook, the agency said.

S&P shifts Tempur Sealy view to stable

S&P said it revised its outlook for Tempur Sealy International Inc. to stable from positive and affirmed the company’s BB- rating.

“The outlook revision to stable from positive reflects our belief that a global recession will substantially curtail demand for Tempur's products. We do not believe the company will achieve our benchmarks for an upgrade during the next 12 months, including maintaining leverage at 3x or below and weathering a recession with peak leverage at 4x,” said S&P in a press release.

Moody's eyes Safilo for downgrade

Moody's Investors Service said it placed under review for downgrade the B2 corporate family rating and the B2-PD probability of default rating of Safilo SpA. The outlook was changed to rating under review from negative.

"We placed Safilo's B2 rating on review for downgrade because the spread of the coronavirus across Europe and the subsequent weakening consumer sentiment is likely to result in lower earnings for Safilo. Although it is difficult to assess today the full impact on the company's performance this year, the rating of Safilo was already weakly positioned in light of the uncertainty on the company's ability to compensate for the loss of the Dior license that will expire at the end of 2020," said Paolo Leschiutta, a Moody's senior vice president and lead analyst for Safilo, in a press release.

Moody's eyes US Foods for trim

Moody's Investors Service said it placed US Foods, Inc.'s Ba3 corporate family rating, Ba3-PD probability of default rating, Ba3 senior secured bank facility and B2 senior unsecured notes rating on review for downgrade. Its speculative grade liquidity rating remains SGL-1.

The review reflects the announced purchase of Smart Foodservice Warehouse Stores from funds managed by affiliates of Apollo Global Management for $970 million in cash which will delay its ability to deleverage.

Moody's sees the short timeframe between US Foods' recent acquisition as being aggressive. The review for downgrade also reflects the negative impact on demand for its products due to the disruption caused by the Covid-19 virus on its restaurant customers.

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