...- U.S.-based payment solution and marketing services provider Harland Clarke Holdings Corp.'s (HCHC) operating performance continues to face secular declines in its key segments including in its Valassis print advertising segment (about 40% of EBITDA of the company) despite a marginal improvement in the second-quarter 2019. The company exhibited a lack of sustained cash flow generation over the past four quarters and HCHC's rolling-12-month adjusted leverage remains high at 6.8x as of June 30, 2019, which in our view will be difficult to sustain given the secular challenges affecting the company. - HCHC also faces large debt maturities totaling approximately $880 million over the next two years and about $800 million of additional senior secured notes are coming due in August 2022. The company signaled it intends to deal with its 2020 and 2021 maturities before the end of the year. We believe the company has elevated refinancing risk due to these near-term maturities. - As a result, we...
