Exhibit 99.1
Ratings
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Bowne & Co. Rating Cut To ‘B’ From ‘BB-’, Still On CreditWatch Negative
Primary Credit Analyst: |
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Michael Listner, New York (1) 212-438-2788; |
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michael_listner@standardandpoors.com |
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Secondary Credit Analyst: |
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Ariel Silverberg, New York (1) 212-438-1807;
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Publication date: 16-Dec-08, 14:36:04 EST | |
ariel_silverberg@standardandpoors.com
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Reprinted from RatingsDirect |
• Current Ratings
NEW YORK (Standard & Poor’s) Dec. 16, 2008—Standard & Poor’s Ratings Services today lowered its
corporate credit rating on Bowne & Co. Inc. to ‘B’ from ‘BB-’. We also lowered the issue-level
rating on Bowne’s convertible subordinated debentures to ‘CCC+’ (two notches lower than the ‘B’
corporate credit rating), from ‘B’. These ratings remain on CreditWatch, where they were placed
with negative implications Nov. 12, 2008. The recovery rating on the subordinated debt remains at
‘6’, indicating our expectation of negligible (0% to 10%) recovery for lenders in the event of a
payment default.
“The ratings downgrade reflects the rapid deterioration in Bowne’s operating performance and,
consequently, the potential for a near-term covenant violation,” said Standard & Poor’s credit
analyst Michael Listner.
Although our expectations for Bowne’s operating performance have always factored in the
highly cyclical nature of revenue and profitability for the firm, the current operating trends
have exceeded our earlier expectations given the extent of the credit freeze and its impact on
transaction volume. We anticipate that transactional revenue will continue to be depressed into
2009, putting further pressure on Bowne’s profitability and credit measures.
The continued CreditWatch listing reflects our concern over the possibility of a near-term
violation of the total leverage covenant and an expectation for heightened leverage and limited
liquidity during the first half of 2009, as the company typically uses cash for working capital
purposes in the first half of the year and repays debt in the latter half. In resolving the
CreditWatch listing, Standard & Poor’s will monitor the progress and resulting terms of an
expected required amendment to the company’s senior credit facility. Ratings may be lowered
further in the near term if a resolution is not put in place to address pressures on the capital
structure and covenant compliance.
Complete ratings information is available to subscribers of
RatingsDirect, the real-time Web-based source for Standard & Poor’s credit ratings, research, and
risk analysis, at www.ratingsdirect.com. All ratings affected by this rating action can be found
on Standard & Poor’s public Web site at www.standardandpoors.com; select your preferred country or
region, then Ratings in the left navigation bar, followed by Credit Ratings Search.
Analytic services provided by Standard & Poor’s Ratings Services (Ratings Services) are the result
of separate activities designed to preserve the independence and objectivity of ratings opinions.
The credit ratings and observations contained herein are solely statements of opinion and not
statements of fact or recommendations to purchase, hold, or sell any securities or make any other
investment decisions. Accordingly,