Research Update: AIS HoldCo LLC Outlook Revised To Negative On Slow Growth And Economic Uncertainty; Ratings Affirmed

The growth efforts of AIS HoldCo LLC (under the Franklin Madison brand) following the spinoff from Affinion in 2018 have largely lagged our expectations and will continue to face challenges given stress from the COVID-19 pandemic and economic uncertainty. We expect AIS' adjusted leverage to be about 7x and coverage to be 1.6x-1.8x in 2020. We are revising our outlook on AIS to negative from stable, and we are affirming our 'B' long-term issuer credit rating on the company and our 'B' long-term issue rating on the company's first-lien credit facility, as well as our 'CCC+' issue rating on the second-lien term loan. The negative outlook reflects AIS' year-end 2019 performance, which fell below our expectations, coupled with the uncertain

...- The growth efforts of AIS HoldCo LLC (under the Franklin Madison brand) following the spinoff from Affinion in 2018 have largely lagged our expectations and will continue to face challenges given stress from the COVID-19 pandemic and economic uncertainty. - We expect AIS' adjusted leverage to be about 7x and coverage to be 1.6x-1.8x in 2020. - We are revising our outlook on AIS to negative from stable, and we are affirming our 'B' long-term issuer credit rating on the company and our 'B' long-term issue rating on the company's first-lien credit facility, as well as our '###+' issue rating on the second-lien term loan. - The negative outlook reflects AIS' year-end 2019 performance, which fell below our expectations, coupled with the uncertain macroeconomic conditions in 2020 from COVID-19, which could pressure leverage and coverage expectations over the next 12 months....

Research Update