Moody's ups Amphenol liquidity to SGL-1

Moody's Investors Service said it upgraded Amphenol Corp.'s speculative-grade liquidity rating to SGL-1 from SGL-2.

Moody's said the SGL-1 liquidity rating reflects Moody's expectations for improving free cash flow through 2004, significant availability under the $125 million revolving credit facility, and improving flexibility under bank financial covenants despite a small step down in the total leverage covenant in the first quarter of 2004 to 3.75x from 3.8x.

The company's liquidity benefits from a lack of upcoming debt maturities in 2004 as amortization payments for both the term loan A and term loan B have been aggressively prepaid. As of Sept. 30, liquidity was further supported by cash on hand of $17 million and revolver availability of $117 million.

Moody's believes the company has few, if any, non-core assets that could be tapped for liquidity without affecting the company's core business offerings. Furthermore, the company has a $70 million accounts receivable securitization facility that could be a use of Amphenol's liquidity if it was not renewed in May of 2004.

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