Bulletin: National Amusements Inc. And Subsidiary Ratings Unaffected By Viacom Inc.'s 50% Dividend Cut

CHICAGO (S&P Global Ratings) Sept. 26, 2016--S&P Global Ratings said today that its ratings and outlooks on Norwood, Mass.–based National Amusements Inc. (NAI; B+/Stable/--) and its operating subsidiary NAI Entertainment Holdings LLC (NAIEH; B+/Stable/--) are not affected by Viacom Inc.'s announcement on Sept. 21, 2016, that it has cut its dividend by 50%. However, we believe the dividend cut will negatively impact NAIEH's EBITDA and cash flow by about 10%, which in turn will somewhat increase the company's leverage and reduce its ability to invest in growth capital expenditures (capex) to improve its theater operations. NAI is the Redstone family trust that owns--along with its operating subsidiary NAIEH--most of the family's stakes in CBS Corp. and Viacom. The dividends from

...CHICAGO (S&P Global Ratings) Sept. 26, 2016--S&P Global Ratings said today that its ratings and outlooks on Norwood, Mass.¡based National Amusements Inc. (NAI; B+/Stable/--) and its operating subsidiary NAI Entertainment Holdings LLC (NAIEH; B+/Stable/--) are not affected by Viacom Inc.'s announcement on Sept. 21, 2016, that it has cut its dividend by 50%. However, we believe the dividend cut will negatively impact NAIEH's EBITDA and cash flow by about 10%, which in turn will somewhat increase the company's leverage and reduce its ability to invest in growth capital expenditures (capex) to improve its theater operations. NAI is the Redstone family trust that owns--along with its operating subsidiary NAIEH--most of the family's stakes in CBS Corp. and Viacom. The dividends from these holdings provide a significant portion of NAIEH's EBITDA and cash flow, which the company uses to service its debt and fund growth capex to improve its existing theater operations. NAIEH had approximately a...

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