DISTRESSED DAILY: Scotts’ Gets Reality Check After Housing Boom

The Scotts Miracle-Gro Co. is experiencing a harsh comedown this year following the company’s housing boom-induced high of 2020 and 2021.

The branded lawn-and-garden care company now finds itself grappling with elevated leverage and declining free operating cash flow after its home improvement and mass merchant retail partners pulled back on ordering this summer -- a reflection of retailers’ wariness surrounding inflated store inventories and cutbacks on consumer discretionary spending.

S&P Global Ratings estimates that Scotts will enter fiscal 2023 with adjusted debt near $3.3 billion -- roughly $1.4 billion above its three-year pre-pandemic average. And the credit rating company ...