Fitch downgrades R.H. Donnelley

Fitch Ratings said it downgraded the issuer default ratings of R.H. Donnelley Corp. and its subsidiaries to B from B+ and the company's senior unsecured notes to CCC+/RR6 from B-/RR6.

The agency also lowered R.H. Donnelley, Inc.'s bank facility to BB/RR1 from BB+/RR1 and its senior unsecured notes to B-/RR5 from BB-/RR3; Dex Media, Inc.'s senior unsecured notes to CCC+/RR6 from B-/RR6; Dex Media East's bank facility to BB-/RR2 from BB+/RR1; and Dex Media West's bank facility and senior unsecured debt to BB/RR1 from BB+/RR1 and its senior subordinated debt to B-/RR5 from B/RR5.

The outlook remains negative.

The agency said the ratings and outlook reflect recent and expected revenue, EBITDA and cash flow declines that have hindered the company's capacity to delever. Regardless of whether the declines are cyclical or secular in nature, the high single-digit declines exceed Fitch's expectations for a cyclical downturn.

In addition, the ratings reflect the company's heavy debt burden and meaningful refinancing risk beginning in 2010, the agency said. Fitch calculates that leverage for the last 12 months ended Sept. 30 was 6.9 times.

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