S&P Global Ratings has placed The Kraft Heinz Co. on Creditwatch Negative after the food company failed to file its Form 10-K for fiscal 2018 by the March 14 due date.

Ratings has placed both its BBB long-term issuer credit rating and its A-2 short-term issuer credit rating for Kraft Heinz on Creditwatch with negative implications, Ratings said March 18.

The due date for Kraft Heinz to file the report was extended to March 14 at the end of February. Nasdaq also issued a standard noncompliance notice to the Pittsburgh-based company as it failed to file the report on time.

Kraft Heinz cited an internal investigation of its procurement operations as a reason for the delay in filing the annual report on time. The packaged food and beverage maker received a subpoena from the SEC in October 2018 as part of an investigation into its accounting procedures.

Ratings plans to resolve the Creditwatch after analyzing the 2018 Form 10-K report and the 2019 first-quarter Form 10-Q. The review will focus on the impact of the disclosures in the filings on the rating agency's view regarding Kraft Heinz's cash flow prospects and de-leveraging potential. The review will also assess any potential accounting irregularities and internal control weaknesses with respect to the SEC probe.

The rating agency could lower or affirm the ratings following the review. Should the company warrant a rating downgrade, the agency said it would likely limit to one notch, unless "particularly" negative information is found.

Ratings also noted the company's operational shortfalls and the $15.4 billion goodwill and intangible charge-off in the fourth quarter of 2018. The rating agency expects Kraft Heinz to seek waivers from its revolving credit facility lenders to maintain access to its $4 billion revolving credit facility.

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.