Moody's downgrades Remington Arms

Moody's Investors Service said it lowered Remington Arms Co. Inc.'s corporate family rating to B3 from B2 and senior unsecured notes to Caa1 from B3. The outlook is negative.

The downgrades reflect Remington's high leverage for the ratings category, credit metrics that were weaker than Moody's anticipated and negative cash flows stemming from the impact of rising metal and energy costs and the company's inability to fully offset these with price increases through 2005.

Moody's said the ratings also recognize continued support from Remington's lenders as it recently secured a new amended and restated credit agreement that increased the asset-based revolving credit facility commitment to $140 million from $101 million, extended the maturity to 2010 from 2008 and reset financial covenant levels and applicable interest rates. Additionally, revenue trends remain favorable.

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