Moody's moves Zellis outlook to positive

Moody's Investors Service said it revised its outlook for Zellis Holdings Ltd.'s to positive from stable and affirmed its Caa1 corporate family rating and Caa1-PD probability of default rating, as well as the Caa1 ratings on the guaranteed senior secured bank credit facilities.

"The change of outlook to positive largely reflects the strengthening in Zellis' operating performance over the past year leading to a material reduction in leverage and broadly break-even free cash flow levels," said Luigi Bucci, Moody's lead analyst for Zellis, in a press release.

"At the same time, while we expect a continued improvement in credit metrics over the next 12-18 months, the company's interest coverage remains weak and its Moody's-adjusted leverage is still very high when expensing capitalized R&D costs," Bucci added.

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