U.S.-based designer, producer, and distributor of licensed, branded, and private-label apparel and accessories Mad Engine Global LLC's leverage has increased to about 6.7x at the end of second quarter ended June 30, 2022, from 5.5x at year-end 2021 on a pro forma basis, as inflationary pressures and a difficult macroeconomic environment weighed on the company's profitability this year. We now expect leverage will remain at about 6x in 2022 compared with our previous expectation of about 4x. We affirmed all of our ratings, including our 'B' issuer-credit rating on the company, and revised our outlook to negative from stable. The negative outlook reflects the potential for a downgrade in the next 12 months if the company is unable to reduce
