Moody’s cuts Infogroup

Moody's Investors Service said it downgraded Infogroup Inc.'s corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

Moody's also downgraded the rating for the company's first-lien senior secured credit facilities to B2 from B1.

The outlook is negative.

“The downgrade reflects the company's weak operating performance with low single digit revenue and earnings declines since its LBO transaction in March 2017, and Moody's expectation that the trend will persist over the next couple of years due to the rapidly evolving and competitive nature of the industry,” Joanna Zeng O'Brien, Moody's lead analyst for Infogroup, said in a news release.

“Moody's expects debt-to-EBITDA leverage will remain high at over 6.5x over the next 12 to 18 months and cash flow generation to be very modest with free cash flow to debt remaining around 1.5% to 2% over the next year. Leverage is high relative to the company's valuation.”

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