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Advertising Gloom Darkens Credit Outlook for European Media Feb 02
Standard & Poors, Feb 2002
Abstract
(Editor's note: This article, first published on Nov. 12, 2001, has been updated to incorporate recent rating actions and revised information on issuers' business positions.) Credit quality among European media companies remains under intense pressure, owing to a rapid decline in advertising revenues that has exposed the high levels of debt arising from industry consolidation. As a result, issuers are challenged to meet their deleveraging plans. The downturn in high-margin advertising revenues reflects slowing economic conditions and could not have come at a worse time. Media companies, several of which have seen debt levels soar after buying businesses at high earnings multiples, face a considerable challenge to grow earnings sufficiently to reduce their debt burdens. Tough short-term prospects for the...
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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