S&P upgrades G-III Apparel

S&P said it raised the issuer credit rating on G-III Apparel Group Ltd. to BB from BB-.

The agency also said it raised the ratings on the company's senior secured credit facility to BB+ from BB.

The recovery rating on this debt remains at 2.

G-III Apparel has outperformed expectations for its Tommy Hilfiger, DKI and Karl Lagerfeld businesses, S&P explained.

The agency said it revised the forecast and now expects the company's financial leverage to decline to the high 1x range by the end of fiscal 2020, instead of a previous expectation of the low 2x range.

The stable outlook reflects a view that the company will maintain leverage of less than 2x absent any transformational acquisitions in the next 12- to 24-months, S&P said.

S&P said it expects G-III's credit metrics to continue to improve as its portfolio of brands continues to gain share in department stores and its margins expand as the DKI business becomes margin accretive.

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