U.S.-based Winebow Group LLC is expected to maintain high leverage into fiscal year 2018 (ending June 30, 2018) due to higher-than-expected costs following a string of acquisitions, brand additions and ongoing elevated inventory levels caused by a weaker-than-expected holiday selling season. Based on our updated projections, we expect leverage to remain well above our 8x debt to EBITDA downgrade trigger and for interest coverage to remain below 2x through fiscal 2018. We are lowering our ratings on the company, including the corporate credit rating to 'B-' from 'B', as well as all associated issue-level ratings . The negative outlook reflects the potential for a lower rating over the next year if the company is unable to realize the EBITDA gains
