Moody's lowers ICON Health

Moody's Investors Service said it downgraded the corporate family rating of ICON Health & Fitness to B2 from B1 and the probability of default rating to B2-PD from B1-PD.

The outlook remains negative.

Moody's said the downgrades reflect its expectation that credit metrics, including leverage of approximately 6.6 times (including Moody's standard accounting adjustments), will not sufficiently improve over the next 12 months despite the company's efforts to diversify its distribution away from its largest customer, Sears.

While the company continues to demonstrate modest growth in other channels, such as Dick's Sporting Goods and online outlets such as Amazon, these efforts are being outpaced by the combined impact of lower consumer demand for its products and weakness at Sears, the agency said.

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