S&P lowers J.B. Poindexter

S&P said it downgraded J.B. Poindexter & Co. and its senior unsecured notes to B+ from BB-.

“We expect the company's Morgan division to have an extremely difficult year, partially mitigated by increased demand in its Morgan Olson segment. Morgan, the larger of the two divisions, manufactures truck bodies for class 5-7 trucks in North America. We believe Morgan's performance will be extremely poor this year given a recession along with a trough year in the U.S. truck market,” S&P said in a press release.

The agency noted U.S. chassis production is down by more than 50% as of early May.

“As such, we expect material double-digit revenue declines within this division along with material margin deterioration as result of supply chain disruption,” S&P said.

S&P said it expects the company’s adjusted debt to EBITDA leverage this year to be in the range of 6x.

The outlook is negative.

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