S&P downgrades Apria’s credit rating
LAKE FOREST, Calif. – Standard & Poor downgraded Apria Healthcare’s credit rating from stable to negative. A cash flow of negative $64 million for the first half of 2012 has raised doubts that Apria will reduce its cash flow to S&P’s estimate of less than negative $20 million by the end of 2012 and return to positive cash flow in 2013. S&P affirmed a “B+” corporate credit rating. The rationale behind the revised outlook is Apria’s “aggressive” financial risk profile, which takes into account the company’s current trend of operating at a cash flow deficit. S&P expects Apria’s cash flow to remain negative in 2012 but to improve from 2011 levels and turn positive by 2013. Other factors contributing to the weak business profile rating include challenges involved with on-shoring the company’s billing and customer service arms and the fragmented nature of the industry.