Moody’s ups Floor and Decor

Moody’s Investors Service said it upgraded the ratings of Floor and Decor Outlets of America, Inc. including its corporate family rating to Ba3 from B1, probability of default rating to Ba3-PD from B1-PD and its senior secured term loan B to Ba2 from B1. Floor & Decor’s speculative grade liquidity rating is SGL-2.

“Floor & Decor benefits from its positive operating trends driven by continued growth in both traffic and average ticket as well as its solid competitive position within the hard surface flooring sector, experienced management which has helped it to navigate a challenging tariff environment, direct sourcing model and good liquidity. The breadth and depth of its product offerings and value focused pricing position it well in the current economic environment,” said Moody’s in a press release.

The company’s leverage on a debt/EBITDA basis declined to around 3x for the LTM period ended September 2019 from a high of 5.7x at the end of fiscal 2016, the agency said.

The outlook is stable.

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