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S&P downgrades Ocean Spray
S&P said it lowered its issuer credit rating on Ocean Spray Cranberries Inc. to BBB- from BBB. The outlook is negative.
At the same time, the agency lowered its issue-level rating on the company's senior unsecured debt to BBB- from BBB.
Additionally, the agency lowered the issue-level rating on Ocean Spray's preferred stock to BB from BB+.
“The downgrade reflects the cooperative's much higher than expected debt leverage due to its acquisition of Atoka Cranberries in Canada and its continued weak operating performance. We had previously expected Ocean Spray's pro forma debt-to-EBITDA to peak near 4.0x before improving thereafter,” S&P said in a news release.
“However, because of the company's continued weak operating performance, which was materially affected by several one-time items, its debt-to-EBITDA increased to 4.6x for the 12 months ended May 30, 2018.”
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