With declining textbooks revenues, Houghton Mifflin Harcourt’s $3.1 billion in debt was downgraded last week to a lowly Caa 3 rating by Moody’s, which said the publisher’s finances are “unsustainable without a significant rebound in earnings” and judged “a debt restructuring in the near term is increasingly likely.” The ratings service says privately-held HMH’s sales fell 16 percent last year, and are targeted to fall 5 percent this year. They had already downgraded HMH’s debt in January as well. The near-term problem is that “Houghton’s management indicated in the fourth quarter earnings call that the company…doesn’t have funding for all the […]