...- Pathway Vet Alliance LLC (Pathway) generated moderately lower cash flow in 2021 than our prior forecast due to high staff vacancy rates (unable to meet customer demand) and rising labor costs during the Omicron variant wave. - We expect cash flow will be minimal in 2022 as the company deals with rising payroll expenses and increases capex spending on de novo facilities, which along with ongoing debt-financed acquisitions, will keep leverage elevated at over 8x - As a result, we lowered our issuer credit rating on Pathway to 'B-' from 'B'. We also lowered our issue-level rating on the senior secured credit facility to 'B-' from 'B'. The recovery ratings are unchanged at '3'. - The stable outlook reflects our expectation that revenue will grow in the mid-single-digit percent area organically for the next 12 months, mostly as a result of pricing increases. While we expect leverage will stay elevated at over 8x in 2023, industry fundamentals remain healthy and we expect margins could stabilize...
