S&P lowers Ascena Retail

S&P said it lowered the issuer credit rating on Ascena Retail Group Inc. to CCC+ from B-, along with the rating on the company's first-lien term loan facility to CCC+ from B with its recovery rating revised to 3 from 2.

The outlook is negative.

Ascena Retail recently reported weak results for its fiscal third quarter that ended in May and continues to face intense industry difficulties as management works to turn around its persistently negative operating trends, S&P said.

The agency said it believes the company's capital structure may be unsustainable in the long term, with elevated operating risk and significant debt obligations maturing in 2022.

The negative outlook reflects a view that operating performance will remain under pressure over the next 12 months, S&P added.

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