Gibson Brands Reports S&P Downgrade in Ratings Was Expected

NASHVILLE, Tenn., Feb. 22, 2018 /PRNewswire/ -- Gibson Brands, Inc. today announced the company was aware that Standard and Poor's might downgrade Gibson Brands a notch because the company has not locked down the refinancing of the bonds. Gibson also realized that our asset-based lender has not changed the 12-month rolling earnings covenant to compensate for a bad April through June quarter and subsequent supply constraint issues in the quarter ended December 2017. Instead, they are choosing to give waivers every month.

Chairman and CEO Henry Juszkiewicz said the Company's third quarter results showed an improvement in net profitability after taxes of just short of $10 million this recently reported quarter, compared to the quarter last year. This reflects two successive quarters of improvement in profitability, and a net profit after interest and taxes. We were able to pay down of $20 million of debt during this period. We continue to be confident in accomplishing our refinancing and expect continuing improvement in operating results. We fully expect our ratings to improve once we announce our refinancing, which is in process.

ABOUT GIBSON

Gibson Brands, one the fastest-growing companies in the music and sound industries, was founded in 1894 and is headquartered in Nashville, TN. Gibson Brands is a global leader in musical instruments, and consumer and professional audio, and is dedicated to bringing the finest experiences by offering exceptional products with world-recognized brands. Gibson has a portfolio of over 100 well-recognized brand names starting with the number one guitar brand, Gibson. Other brands include: Epiphone, Dobro, Valley Arts, Kramer, Steinberger, Tobias, Slingerland, Maestro, Baldwin, Hamilton, Chickering and Wurlitzer. Audio brands include: KRK Systems, TASCAM, Cakewalk, Cerwin-Vega!, Stanton, Onkyo, Integra, TEAC, TASCAM Professional Software, and Esoteric. All Gibson Brands are dedicated to innovation, prestige and improving the quality of life of our customers.

SOURCE Gibson Brands