Moody's cuts Winn-Dixie ratings

Moody's Investors Service said it lowered all ratings of Winn-Dixie Stores Inc.

Ratings lowered include the $300 million 8.875% senior notes due 2008 to B1 from Ba2, the $1 billion senior unsecured shelf to prospective B1 from prospective Ba2, the senior implied rating to Ba3 from Ba1, and the long-term issuer rating to B1 from Ba2. Moody's does not rate the current $300 million secured revolving credit facility.

The outlook remains negative.

Moody's said the downgrade was prompted by Moody's belief that the recent deterioration in revenue, margins, and debt protection measures will persist over at least the medium-term, the challenges in winning back customers and market share from efficient competitors such as Publix and the Wal-Mart supercenter format, and the likelihood that the company needs to carry out a substantial asset rationalization program.

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