Herndon, Va.-based Beacon Roofing Supply Inc. has reduced debt-to-EBITDA leverage since its acquisition of Roofing Supply Group (RSG) in September 2015, from 5.5x (including operating lease adjustments) as of the quarter ending December 2015 to 4.2x presently. We are revising our rating outlook on Beacon to positive from stable, indicating our belief that the company will continue to lower and sustain leverage in the 3x-4x range over the next 12-24 months. At the same time, we are affirming our 'BB-' corporate credit rating on Beacon and our 'BB+' and 'B+' issue-level ratings on its $450 million term loan B due 2022 and $300 million senior unsecured notes due 2023, respectively. Our positive outlook further reflects our view that Beacon will
