U.K. Leisure Company Georgica PLC Rated 'B-'; Outlook Stable; Proposed Notes Rated 'CCC+'
LONDON (Standard & Poor's) June 22, 2005--Standard & Poor's Ratings Services
said today it assigned its 'B-' long-term corporate credit rating to
U.K.-based leisure company Georgica PLC. The outlook is stable.
At the same time, Standard & Poor's assigned its 'CCC+' senior secured
debt rating to the company's proposed £60 million ($110 million) bond issue.
The rating is subject to receipt of final documentation.
"The ratings on Georgica reflect the company's highly leveraged financial
profile, its potential susceptibility to consumer confidence, competition from
other leisure activities, and high operational gearing," said Standard &
Poor's credit analyst Olli Rouhiainen. "These factors are partly mitigated by
the company's leading position in the U.K. cue sports club and bowling center
markets, its steady cash flow generation, and relatively low cyclicality due
to low average spend per customer."
Georgica has a good track record of profitability from its Riley's brand
cue clubs, combined with low maintenance capital expenditure needs. The
company will need to reach and maintain lease-adjusted total debt to EBITDA of
about 6x by year-end 2006. With very high leverage, Georgica remains
vulnerable to negative changes in the operating environment and the ratings
could be lowered if the company fails to meet the above leverage target due to
lower profitability stemming, for example, from changes in consumer spending,
increasing costs, or lower-than-expected returns on refurbishments.
Ratings information is available to subscribers of RatingsDirect,
Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com.
It can also be found on Standard & Poor's public Web site at
www.standardandpoors.com; under Credit Ratings in the left navigation bar,
select Find a Rating, then Credit Ratings Search. Alternatively, call one of
the following Standard & Poor's numbers: London Ratings Desk (44)
20-7176-7400; London Press Office Hotline (44) 20-7176-3605; Paris (33)
1-4420-6708; Frankfurt (49) 69-33-999-225; Stockholm (46) 8-440-5916; or
Moscow (7) 095-783-4017. Members of the media may also contact the European
Press Office via e-mail on: media_europe@standardandpoors.com.
GROUP E-MAIL ADDRESS
CorporateFinanceEurope@standardandpoors.com
| Primary Credit Analyst: | Olli Rouhiainen, London (44) 20-7176-3769; olli_rouhiainen@standardandpoors.com |
| Secondary Credit Analyst: | Anna Overton, London (44) 20-7176-3642; anna_overton@standardandpoors.com |
No content (including ratings, credit-related analyses and data, valuations, model, software, or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced, or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor’s Financial Services LLC or its affiliates (collectively, S&P). The Content shall not be used for any unlawful or unauthorized purposes. S&P and any third-party providers, as well as their directors, officers, shareholders, employees, or agents (collectively S&P Parties) do not guarantee the accuracy, completeness, timeliness, or availability of the Content. S&P Parties are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, for the results obtained from the use of the Content, or for the security or maintenance of any data input by the user. The Content is provided on an “as is” basis. S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE, FREEDOM FROM BUGS, SOFTWARE ERRORS OR DEFECTS, THAT THE CONTENT’S FUNCTIONING WILL BE UNINTERRUPTED, OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION. In no event shall S&P Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs or losses caused by negligence) in connection with any use of the Content even if advised of the possibility of such damages.
Credit-related and other analyses, including ratings, and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact. S&P’s opinions, analyses, and rating acknowledgment decisions (described below) are not recommendations to purchase, hold, or sell any securities or to make any investment decisions, and do not address the suitability of any security. S&P assumes no obligation to update the Content following publication in any form or format. The Content should not be relied on and is not a substitute for the skill, judgment, and experience of the user, its management, employees, advisors, and/or clients when making investment and other business decisions. S&P does not act as a fiduciary or an investment advisor except where registered as such. While S&P has obtained information from sources it believes to be reliable, S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. Rating-related publications may be published for a variety of reasons that are not necessarily dependent on action by rating committees, including, but not limited to, the publication of a periodic update on a credit rating and related analyses.
To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes, S&P reserves the right to assign, withdraw, or suspend such acknowledgement at any time and in its sole discretion. S&P Parties disclaim any duty whatsoever arising out of the assignment, withdrawal, or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof.
S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of S&P may have information that is not available to other S&P business units. S&P has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process.
S&P may receive compensation for its ratings and certain analyses, normally from issuers or underwriters of securities or from obligors. S&P reserves the right to disseminate its opinions and analyses. S&P's public ratings and analyses are made available on its Web sites, www.spglobal.com/ratings (free of charge), and www.ratingsdirect.com (subscription), and may be distributed through other means, including via S&P publications and third-party redistributors. Additional information about our ratings fees is available at www.spglobal.com/usratingsfees.
Any Passwords/user IDs issued by S&P to users are single user-dedicated and may ONLY be used by the individual to whom they have been assigned. No sharing of passwords/user IDs and no simultaneous access via the same password/user ID is permitted. To reprint, translate, or use the data or information other than as provided herein, contact S&P Global Ratings, Client Services, 55 Water Street, New York, NY 10041; (1) 212-438-7280 or by e-mail to: research_request@spglobal.com.