Standard & Poor’s Ratings Services last week affirmed its ratings on Neff Corp., including its ‘CCC’ corporate credit rating.
At the same time, all ratings were removed from CreditWatch, where they were placed on Nov. 1, 2002. The outlook is negative. The company’s debt totaled approximately $275 million as of March 31, 2003. Miami, Fla.-based Neff is No. 10 on the RER 100.
“The rating actions follow information obtained from the company that Neff made its June 1, 2003, interest payment on the subordinated notes and reached an agreement with its lenders to amend certain terms of its revolving credit facility,” said Standard & Poor’s credit analyst John Sico.
The company had received a waiver of certain defaults under its credit facility. The new amendment waives the financial covenant violations and reduces the maximum commitment under the credit facility.
The ratings reflect the company’s modest position in the challenging equipment rental industry, a constrained liquidity position, weak operating performance, and heightened financial risk, the Standard & Poor’s report said.
Prior to receiving the amendment to its credit facility, Neff had been operating under a forbearance agreement that prevented bank lenders from exercising remedies as a result of Neff’s leverage covenant violation. Because of the company’s bank covenant violations and operating losses, auditors had expressed doubt about the company’s ability to continue as a going concern.