Moody’s ups UNFI, rates notes B3

Moody’s Investors Service said it upgraded the corporate family rating and probability of default rating of United Natural Foods, Inc. (UNFI) to B1 and B1-PD from B2 and B2-PD, respectively. Moody’s also assigned a B3 rating to the company’s new proposed senior unsecured notes.

Concurrently, Moody’s also upgraded the rating of the company’s senior secured term loan to B2 from B3. The company’s speculative grade liquidity rating is upgraded to SGL-1 from SGL-2.

“UNFI’s operating performance has been better than expected as the integration of the Supervalu operations is nearing completion and the company has lowered its debt burden while improving EBITDA thereby improving credit metrics,” said Mickey Chadha, a Moody’s vice president, in a press release.

“The increase in sales volumes due to pantry loading during the coronavirus pandemic has also been a tailwind for the company, and we expect the demand for specialty groceries will remain high even after consumer buying patterns normalize,” Chadha stated.

The outlook is stable.

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