Moody's cuts Allen Vanguard

Moody's Investors Service said it downgraded Allen Vanguard Corp.'s corporate family rating to B3 from B1, probability-of-default rating to Caa1 from B2, senior secured rating to B3 (LGD3, 31%) from B1 (LGD3, 31%) and speculative grade liquidity rating to SGL-4 from SGL-3.

The outlook is stable.

According to Moody's, the downgrade reflects significant shortfall in the third quarter compared with expectations.

The potential for some volatility to results was considered, but the magnitude of the earnings shortfall has heightened concerns about the ability to comply with financial covenants in its bank facility through the next several quarters, the agency said.

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