S&P lowers Urban One secured debt

S&P said it revised the outlook on Urban One Inc. to stable from negative and affirmed its B- issuer credit rating.

The agency also said it revised the recovery rating on the company's existing senior secured debt to 3 from 2 and lowered the issue-level ratings to B- from B.

The stable outlook reflects an expectation that Urban One will generate about $50 million of free operating cash flow over the next year, which will be primarily used for debt reduction and reduce leverage to the mid-6x range, S&P said.

The outlook revision also considers the reduced refinancing risk following Urban One's prospective repurchase of its senior subordinated notes and an expectation that the company will generate sufficient cash to reduce leverage from about 7x to the mid-6x range over the next year.

The company also performed in line with expectations for the first three quarters of 2018, stabilizing revenue declines following a sharp decline in 2017, S&P said.

The ratings continue to reflect ongoing low-single digit percentage revenue declines in the company's radio and cable segments, which make up more than 80% of its revenue, the agency said.

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