Moody's moves G-III Apparel view to positive

Moody's Investors Service said it changed G-III Apparel Group, Ltd.'s outlook to positive from negative.

“The outlook change to positive reflects G-III's better than expected operating performance and credit metrics over the past year, as the company was able to navigate the very challenging environment by effectively reducing costs and debt, and the successful restructuring of its retail operations including the closure of the Wilsons Leather, G.H. Bass and Calvin Klein Performance stores. Although still having weakened in 2020 due to the pandemic, the company continues to maintain solid metrics, with debt/EBITDA of around 2.2 times as of April 2021,” the agency said in a press release.

Moody’s also affirmed G-III’s ratings, including the corporate family rating at Ba3, probability of default rating at Ba3-PD and the senior secured notes rating at Ba3. The speculative-grade liquidity rating was upgraded to SGL-1 from SGL-3.

“The upgrade to SGL-1 reflects the company's very good liquidity position, supported by $396 million of cash and $614 million of availability under its undrawn $650 million ABL revolver at the end of April 2021, as well as Moody's expectation for continued positive free cash flow over the next 12-18 months,” the agency said.

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