S&P Global Ratings lowered its issuer credit rating on Lions Gate Entertainment Corp. to B from B+ and removed the company from Creditwatch with negative implications.
The rating agency also lowered issue-level ratings on Lions Gate's secured debt to B+ from BB- and its unsecured notes to CCC+ from B-.
Lions gate recently reached a long-term deal with Comcast Corp. for the continued carriage of Starz networks on Xfinity TV. S&P Global Ratings expects that the company's profitability will be pressured by higher marketing and content spending, expansion costs for Starz, and the possibility of revenue and earnings becoming unstable as the company continues to shift its Starz distribution to an à la carte model domestically.
The outlook on the company is stable, reflecting S&P Global Ratings' expectation that Lions Gate's revenue will grow in the mid-single-digit percentage range in fiscal 2020 and remain flat in 2021.
This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.