NEW YORK, NY--Standard & Poor's Ratings Services has revised its outlook on Lebanon, Tenn.–based Cracker Barrel Old Country Store Inc. (CBRL) to negative from stable.We have also affirmed the company's ratings, including its 'BB-' corporate credit rating.
"The outlook revision is due to CBRL's weakening operating performance," said Standard & Poor's credit analyst Jackie E. Oberoi.
Credit metrics are weak for the rating and the company's EBITDA cushion over financial covenants narrowed to about 5% for the first quarter."While we expect the company to reduce debt from seasonal peak levels over the next quarter such that the EBITDA cushion widens to about 9%," added Ms. Oberoi, "we remain concerned that without additional debt pay-down, CBRL may have difficulty meeting financial covenants when they step down in the fourth quarter next July."
Media Contact: David Wargin, New York (1) 212.438.1579, david_wargin@standardandpoors.com
Analyst Contact: Jackie E Oberoi, New York (1) 212.438.2895
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