S&P affirms Mohawk

Standard & Poor's said it affirmed its BB+ corporate credit rating on Mohawk Industries Inc., affirmed the BB+ issue-level rating on its unsecured debt and revised the recovery rating to 3, indicating the likelihood of meaningful (50%-70%) recovery in the event of a payment default, from 4.

The ratings were removed from CreditWatch - where they had been placed with negative implications on Sept. 9, 2009 following concerns about the difficult operating environment facing Mohawk and its ability to improve credit measures - and the outlook is now stable.

The agency said the ratings on Mohawk reflect the company's satisfactory business risk profile, which incorporate its strong competitive position in the carpet and floor coverings market, and its vertically integrated operations, comprehensive product portfolio and diverse customer base.

However, Mohawk participates in a mature and cyclical industry, and Moody's believes the company is vulnerable to reduced discretionary spending in an economic downturn and weak housing market.

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