Fitch Ratings Sees 'Significant Maturity Walls' Ahead For Clear Channel
February 8, 2012 at 3:50 AM (PT)
FITCH RATINGS has affirmed the 'CCC' Issuer Default Rating of CLEAR CHANNEL COMMUNICATIONS, as well as the 'B' rating of CLEAR CHANNEL WORLDWIDE HOLDINGS. FITCH's ratings concerns center on "the company's highly leveraged capital structure, with significant maturities in 2014 and 2016; the considerable and growing interest burden that pressures free cash flow; technological threats and secular pressures in radio broadcasting; and the company's exposure to cyclical advertising revenue," reports SUNHERALD.COM.
The report notes, "CLEAR CHANNEL faces significant maturity walls in 2014 and 2016 of $2.8 billion and $12.2 billion, respectively (primarily bank loans)."
FITCH forcasts "an increasing probability that CLEAR CHANNEL will be able to address the 2014 maturity wall without the need of an extension by the lenders. An extension would certainly be a positive in that it would provide the company with increased financial flexibility to deal with subsequent maturities."