Moody's boosts Mattress Holding

Moody's Investors Service said it upgraded Mattress Holding Corp.'s corporate family and probability-of-default ratings to B3 from Caa1 and the ratings on its senior secured credit facilities to B1 (LGD2, 29%) from B2 (LGD2, 29%).

The outlook is stable.

The upgrade acknowledges the recent improvement in Mattress Holding's operating performance and credit metrics, and reflects the view that the company, despite its high leverage, has some cushion to withstand modest fluctuations in performance during a protracted economic recovery, according to the agency.

The B3 corporate family rating reflects Mattress Holding's high leverage, small size, recent volatility of mattress sales and home sales, the agency said.

Ratings also reflect the company's good liquidity, as well as its credible market position in the narrowly defined specialty retail sleep channel, its regional presence and moderate seasonality, the agency said.

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