Moody’s changes NPC view to stable

Moody's Investors Service said it changed the outlook of NPC International, Inc. to stable from negative and raised the speculative grade liquidity rating to SGL-2 from SGL-3.

Concurrently, the agency affirmed NPC's B2 corporate family rating, B2-PD probability of default rating, B1 senior secured bank ratings and Caa1 senior unsecured note rating.

"The change in outlook to stable reflects Moody's view that NPC's leverage will remain well below 6.0 times while maintaining good liquidity," Moody's senior credit officer Bill Fahy said in a news release.

"These improvements are driven in part by the earnings benefit of materially lower commodity costs that has helped to offset higher labor costs and more recently a modest deceleration in negative comparable sales trends at Pizza Hut and strong operating trends at Wendy's which we expect to continue over the near-term."

For the LTM period ending Sept. 30, 2015, NPC's debt to EBITDA was about 5.7 times.

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