Research Update: US Foods Inc. Ratings Lowered To 'BB-' From 'BB', Removed From Watch Negative; Outlook Stable

Foodservice demand from restaurants and other food-away-from-home venues will likely remain weak over the next year, though above the depressed levels of the second quarter of 2020. S&P Global Ratings is lowering all of its ratings on foodservice distributor US Foods Inc. by one notch, including the issuer credit and senior secured debt ratings to 'BB-' from 'BB', and the senior unsecured debt rating to 'B+' from 'BB-'. All of our ratings have been removed from CreditWatch, where they were placed with negative implications on March 6, 2020. The stable outlook reflects our expectation for gradually improving comparable sales and profit performance over the next year--though well below pre-COVID-19 levels--resulting in adjusted leverage approaching 5x in 2021. It also reflects

...- Foodservice demand from restaurants and other food-away-from-home venues will likely remain weak over the next year, though above the depressed levels of the second quarter of 2020. - S&P Global Ratings is lowering all of its ratings on foodservice distributor US Foods Inc. by one notch, including the issuer credit and senior secured debt ratings to '##-' from '##', and the senior unsecured debt rating to 'B+' from '##-'. All of our ratings have been removed from CreditWatch, where they were placed with negative implications on March 6, 2020. - The stable outlook reflects our expectation for gradually improving comparable sales and profit performance over the next year--though well below pre-COVID-19 levels--resulting in adjusted leverage approaching 5x in 2021. It also reflects our base-case forecast for continued strong liquidity through 2021....

Research Update