Moody's stabilizes KC Culinarte view

Moody's Investors Service said it changed the outlook to stable from negative and affirmed KC Culinarte Intermediate, LLC’s (Kettle Cuisine) B3 corporate family rating, B3-PD probability of default rating and B2 rating on the company's first-lien senior secured debt.

The outlook revision reflects the company's recent improvement in earnings and free cash flow and the view that most of the company's inflationary costs pressures can be offset with price increases, Moody’s said.

Kettle Cuisine's foodservice customers suffered closures and volume declines because of the coronavirus pandemic.

“In the past few quarters, the company has reported a meaningful improvement in sales and EBITDA as demand from its foodservice customers has rebounded. In addition, the company has continued to experience strong sales volume from its retail customers, who benefitted from pantry loading and closures in the foodservice channel. Lastly, the outlook change to stable reflects Moody's expectations that Kettle Cuisine will continue to generate positive free cash flow,” the agency said in a press release.

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