Moody's cuts Whole Earth Brands

Moody's Investors Service said it downgraded Whole Earth Brands, Inc.'s corporate family rating to B3 from B2, the probability of default rating to B3-PD from B2-PD and the ratings on its first-lien revolving credit facility and first-lien term loan to B3 from B2.

“The downgrade reflects Whole Earth Brands' weaker-than-expected results for the first nine months of fiscal 2022 and Moody's expectations that earnings will remain weak, and that leverage will remain elevated in the next 12 to 18 months. Inflationary cost pressures combined with supply chain challenges have been headwinds for the company in the last 12 months.

“As of Sept. 30, 2022, Whole Earth Brand's Moody's adjusted debt to EBITDA was approximately 7.6x, which is meaningfully higher than Moody's had forecasted for the B2 credit rating,” the agency said in a press release.

The outlook is negative.

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