Research Update: Blue Ribbon Intermediate Holdings LLC Downgraded To 'B-' On Continued Weak Operating Performance, Outlook Negative

U.S. beer marketer Blue Ribbon Intermediate Holdings LLC's (Blue Ribbon) operating performance remained weak in the first half of 2019 because of softer-than-expected volumes and cost inflation. We are lowering our performance forecast for the company and expect that its liquidity will remain pressured given its significantly lower cash flow generation and reduced revolver availability following the recent amendment to the facility, which reduced its commitment to $36 million from $95 million previously. Therefore, we are lowering our issuer credit rating on Blue Ribbon and our issue-level rating on its first-lien credit facilities--including its $495 million term loan maturing in 2021 ($452 million outstanding) and $36 million revolving credit facility maturing in May 2020--to 'B-' from 'B'. The negative outlook

...- U.S. beer marketer Blue Ribbon Intermediate Holdings LLC's (Blue Ribbon) operating performance remained weak in the first half of 2019 because of softer-than-expected volumes and cost inflation. - We are lowering our performance forecast for the company and expect that its liquidity will remain pressured given its significantly lower cash flow generation and reduced revolver availability following the recent amendment to the facility, which reduced its commitment to $36 million from $95 million previously. - Therefore, we are lowering our issuer credit rating on Blue Ribbon and our issue-level rating on its first-lien credit facilities--including its $495 million term loan maturing in 2021 ($452 million outstanding) and $36 million revolving credit facility maturing in May 2020--to 'B-' from 'B'. - The negative outlook reflects the risk that a potential slowdown in consumer spending or continued cost inflation could weigh on the company's deleveraging plans over the next 12 months. Our...

Research Update