Goodman Networks, Inc. -- Moody's downgrades Goodman to Caa1; outlook stable

New York, May 29, 2015 -- Moody's Investors Service ("Moody's") has downgraded Goodman Networks, Inc.'s ("Goodman" or the "company") corporate family rating (CFR) to Caa1, probability of default rating (PDR) to Caa1-PD and senior secured debt ratings to Caa1. Revenue for the first quarter of 2015 declined 17% year-over-year due to decreases in the volume of projects completed with AT&T and decreases in the volume of services provided to Alcatel-Lucent. AT&T has announced sharp cuts to its domestic capital spending which will impact Goodman as revenues from AT&T represent over 60% of total revenue. Moody's expects Goodman's full year 2015 results to weaken further such that its credit metrics and liquidity will deteriorate. The downgrade reflects Moody's expectation that Goodman's financial leverage will be sustained well above 5x (Moody's adjusted) for the rating horizon, margins will contract, and the company will consume cash. The outlook is stable.

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