Research Update: ADMI Corp. Outlook Revised To Negative From Stable; 'B-' Rating Affirmed

U.S.-based ADMI Corp.'s (doing business as The Aspen Group) operating and financial results continue to lag our expectations due to more severe after-effects from a cyber incident earlier this year and weaker performance in its urgent care (WellNow) and dental implant (ClearChoice) businesses. Furthermore, the company faces the maturities of its first-lien term loan ($875 million outstanding) and $450 million revolving credit facility ($272 million outstanding), which come due in 2025. While we believe ADMI has good prospects to improve performance over the next year given favorable growth trends in its dental business (Aspen Dental), and the one-time nature of the cyber incident, we believe there is heightened refinancing risk based on its weak free cash flow generation, high leverage,

...- U.S.-based ADMI Corp.'s (doing business as The Aspen Group) operating and financial results continue to lag our expectations due to more severe after-effects from a cyber incident earlier this year and weaker performance in its urgent care (WellNow) and dental implant (ClearChoice) businesses. - Furthermore, the company faces the maturities of its first-lien term loan ($875 million outstanding) and $450 million revolving credit facility ($272 million outstanding), which come due in 2025. - While we believe ADMI has good prospects to improve performance over the next year given favorable growth trends in its dental business (Aspen Dental), and the one-time nature of the cyber incident, we believe there is heightened refinancing risk based on its weak free cash flow generation, high leverage, and challenging capital market conditions. - We revised the outlook to negative from stable and affirmed all ratings on the company, including our 'B-' issuer credit rating. - The negative outlook...

Research Update