Research Update: Corus Entertainment Inc. Outlook To Stable From Negative On Expectation Of Improving Credit Measures; Affirmed At 'BB'

Toronto-based media company Corus Entertainment Inc. is expecting to post improved credit metrics driven by debt reduction, while stabilizing its core television business despite challenging market conditions for traditional media companies. We believe Corus can deleverage to the low-3x area by fiscal 2021 compared with 3.4x in fiscal 2019, given the company's stated desire to use excess free cash flow to reduce debt. As a result of this deleveraging, on Jan. 20, 2020, S&P Global Ratings revised its outlook on Corus to stable from negative. At the same time, we affirmed our 'BB' long-term issuer credit rating on the company, and our 'BB+' issue-level rating, with a '2' recovery rating, on Corus' senior secured debt. The stable outlook reflects our

...- Toronto-based media company Corus Entertainment Inc. is expecting to post improved credit metrics driven by debt reduction, while stabilizing its core television business despite challenging market conditions for traditional media companies. - We believe Corus can deleverage to the low-3x area by fiscal 2021 compared with 3.4x in fiscal 2019, given the company's stated desire to use excess free cash flow to reduce debt. - As a result of this deleveraging, on Jan. 20, 2020, S&P Global Ratings revised its outlook on Corus to stable from negative. - At the same time, we affirmed our '##' long-term issuer credit rating on the company, and our '##+' issue-level rating, with a '2' recovery rating, on Corus' senior secured debt. - The stable outlook reflects our expectation that the company's leverage measures will be in the low 3x area over the next 12 months driven by a combination of debt reduction and steady operating performance....

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