Well, this can’t be good. Baker & Taylor, the self-proclaimed “world’s largest distributor of books and entertainment”, insists they aren’t in trouble, even though their credit rating has been downgraded. On February 20th, Moody’s lowered B&T’s default rating to B3, due to the distributor’s rising debts. A B&T spokesperson denies they are in danger of defaulting or bankruptcy.
Kimberly Kuo, EVP of marketing with Baker & Taylor, said the rating didn’t properly reflect the distributor’s daily operations and instead based its speculative outlook on the economic downturn at the end of 2008.
She said a lot of high-profile companies have joined Moody’s watch list during the recession, including some considered at extreme high-risk to others regarded as more secure. Kuo said the list was fluid and updated regularly.
“We are focusing heavily on working capital, which has helped generate cash, reduce debt levels and maintained the company’s leverage ratio,” she said.
Kuo goes on to say that the company has plenty of liquidity and is in no danger of not paying the bills.
B&T sells vast amounts of books — including graphic novels — to both bookstores and libraries. Let’s just say this developing story bears continuing scrutiny.