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Investing.com -- Fitch Ratings has upgraded The E.W. Scripps Company’s Long-Term Issuer Default Rating to ’ CCC (WA:CCCP)’ from ’CCC-’ following recent refinancing efforts that addressed the company’s 2027 maturity obligations.
The rating agency also upgraded Scripps’ senior secured debt to ’B’ with a Recovery Rating of ’RR1’ from ’B-’/’RR1’, and senior unsecured debt to ’CC’/’RR6’ from ’C’/’RR6’. Additionally, Fitch assigned a ’CCC-’/’RR5’ rating to Scripps’ new senior secured second-lien debt.
The upgrades reflect Scripps’ refinancing actions in the first half of 2025, which improved the company’s near-term liquidity position. However, Fitch noted that long-term structural challenges in the TV broadcasting industry continue to affect the company’s credit profile.
According to Fitch, Scripps faces an estimated $1.8 billion in debt maturities over the next four years, even with the new second lien issuance. The rating agency believes Scripps is unlikely to organically grow into its capital structure through 2028 and will continue to require favorable credit conditions to extend maturities.
The local television industry remains under pressure as national networks increasingly retain exclusive sports and entertainment content on their direct-to-consumer platforms rather than distributing it through local broadcast affiliates. This trend puts pressure on Scripps’ traditional distribution model and may limit long-term revenue growth.
Scripps also faces challenges in the national advertising market, which has slowed over the past four years due to high post-pandemic interest rates and increased competition from digital media. The company’s high-margin retransmission business growth may be nearing its peak as rising cable network costs and subscriber losses impact the segment.
In its key assumptions, Fitch projects core advertising to decline by mid- to high-single digits in 2025 due to slower demand during a non-political year and macroeconomic uncertainty. The agency expects a modest recovery in 2026, followed by average mid-single-digit growth in 2027 and 2028.
Fitch has withdrawn Scripps’ 2027 unsecured bond ratings as the bonds were pre-refunded.
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