Moody’s gives Renfro amended loan B3

Moody's Investors Service said it affirmed Renfro Corp.’s corporate family and probability of default ratings of B3 and B3-PD, respectively, and assigned a B3 rating to the proposed amended first-lien term loan due 2021.

The outlook is stable.

The proposed amended $161 million term loan extends the maturity from January 2019 to March 2021, increases covenant cushion, tightens certain provisions and modestly increases the interest rate.

"The amendment is credit positive, as it extends the 2019 maturity and improves covenant cushion while adding only about $1 million of cash interest expense," Moody's analyst Raya Sokolyanska said in a news release.

"Renfro's credit metrics position the rating solidly in the B3 category, with 5.3 times Moody's-adjusted debt/EBITDA and 1.9 times EBITA/interest expense on a pro-forma basis. However, we expect continued headwinds from de-stocking and traffic declines to offset the gains from Renfro's new Made in the USA program with Wal-Mart, resulting in flat to modestly weaker earnings performance in the next 12-28 months."

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