Moody's upgrades Wall Street Systems

Moody's Investors Service said it upgraded Wall Street Systems Holdings, Inc.’s corporate family rating to B2 from B3, probability of default rating to B2-PD from B3-PD and senior secured credit facility to B2 (LGD3) from B3 (LGD3). The outlook remains stable.

The agency said the upgrade reflects the company's continued deleveraging, which supports Moody's view that the company is now following a financial policy more consistent with a B2 corporate family rating. The debt-to-EBITDA ratio improved to about 4.2 times for the trailing 12 months ended March 31.

The B2 corporate family rating reflects the company’s relatively small scale as a niche provider of software and services for corporate treasury departments and financial institutions, the agency said. Moreover, Moody's believes that revenue growth will be modest due to the maturity of the industry and that there will be few opportunities for further EBITDA growth given the significant cost reductions over the past several years.

At the same time, the company has a solid market position and a recurring revenue base driven by a subscription-based model and minimal client attrition, Moody’s said.

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