S&P views Interior Logic negatively

S&P said it changed its outlook for Signal Parent Inc. (Interior Logic Group Holdings LLC) to negative from stable and affirmed its B- rating.

ILG’s leverage was above 10x as of its third quarter ended Sept. 30, 2022, and free cash flow was substantially negative through the first three quarters, S&P noted.

“Some of the top publicly traded homebuilders, ILG's primary customers, are reporting fourth-quarter declines in new orders of roughly 40%. Housing starts dropped severely toward the end of 2022, and S&P Global Ratings economists forecast housing starts to decline more than 20% in 2023. We expect this will materially constrain housing completions and ILG's credit measures in 2024,” the agency said in a press release.

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