Moody's: Ahold view to positive

Moody's Investors Service said it changed the outlook on the Baa3 issuer and senior unsecured ratings of Koninklijke Ahold NV and its fully owned and fully guaranteed subsidiary Ahold Finance USA, LLC to positive from stable.

Concurrently, Moody's affirmed these ratings.

"Today's rating action primarily reflects Ahold's track record of continued stable operating performance, despite a challenging retail environment in both the US and the Netherlands, with a further improvement in reported underlying operating income in FY 2012," Andreas Rands, Moody's vice president, senior analyst and lead analyst for Ahold said in a news release.

"The change of outlook also reflects Ahold's sustained ability to generate around €1 billion of reported free cash flow per annum, which provides the company with significant financial flexibility."

"Furthermore, the outlook change takes into account that the company has used its cash flow in a fairly balanced way, enabling the gradual strengthening of its financial profile, with debt repayments of around €1.2 billion over the past four fiscal years," Rands added in the release.

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