Moody's alters Tecta outlook to stable

Moody's Investors Service said it changed the outlook to stable from negative and affirmed Tecta America Corp.'s B2 corporate family rating, B2-PD probability of default rating, B1 senior secured credit facility rating and a Caa1 second-lien term loan rating.

“The change in the outlook to stable from negative reflects the company's improving debt/EBITDA leverage, estimated at 6.1x at Sept. 30, 2021 since integrating an M&A target and funding a dividend distribution with incremental debt in March 2021. Moody's now expects Tecta's leverage will decline towards 5.5x by the end of 2022, driven by favorable demand trends for roofing maintenance and replacement services,” Moody’s said in a press release.

As a percentage of debt, the agency said it forecasts free cash to be in the high single-digit range, relatively strong for the B2 rating category.

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