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Moody’s ups Floor & Decor, loan
Moody's Investors Service said it upgraded Floor & Decor Outlets of America, Inc.’s corporate family rating to B1 from B2, probability of default rating to B1-PD from B2-PD and senior secured term loan B to B1 from B2.
In addition, the agency assigned a speculative grade liquidity rating of SGL-3.
The outlook is stable.
"Today's upgrade to B1 reflects Floor & Decor's material debt reduction to date and consistent positive operating trends that has resulted in a significant and sustained improvement in credit metrics," Moody's senior credit officer Bill Fahy said in a news release.
Floor & Decor's leverage on a debt/EBITDA basis improved to 3.7 times for the LTM period ended September 2017 from a high of 5.7 times at the end of fiscal 2016, the agency explained. Earlier this year, Floor & Decor used the proceeds from its initial public offering to repay approximately $192 million of outstanding debt.
"Moreover, operating trends have remained strong and driven by both positive transactions and average ticket size which we expect to continue as the company benefits from a moderate US housing market recovery, more specifically home remodeling,” Fahy added in the release.
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