Moody's: Tube City IMS view stable

Moody's Investors Service said it affirmed Tube City IMS Corp.'s corporate family rating at B2, probability of default at B2, senior secured letter of credit facility at B1 (to LGD3, 36% from LGD3, 34%), senior secured term loan at B1 (to LGD3, 36% from LGD3, 34%) and senior subordinate notes at Caa1 (to LGD5, 81% from LGD5, 80%). The agency also said it upgraded the speculative grade liquidity rating to SGL-2 from SGL-3.

The outlook was changed to stable from negative.

The outlook change reflects operational adjustments made by the company that limited the impact on profitability of lower steel capacity utilization rates, Moody's said, along with free cash flow generation during the downturn and improved conditions in the domestic steel industry.

The ratings reflect the company's dependence on sales to the volatile and highly cyclical domestic steel industry, customer concentration, modest tangible assets, significant capital expenditure requirements and a highly leveraged capital structure, the agency said.

The ratings are supported by its good reputation, favorable track record of retaining customers and good liquidity, Moody's said.

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