Moody's flips Men's Wearhouse view to positive

Moody's Investors Service said it changed the outlook to positive from negative and affirmed the Men's Wearhouse, LLC's ratings, including the Caa1 corporate family rating, the Caa1-PD probability of default rating, the B3 rating on the senior secured priority term loan due 2025 and the Caa1 rating on the senior secured takeback term loan due 2025.

“The outlook change to positive reflects the improvement in Men's Wearhouse's performance, credit metrics and liquidity over the past year as it began to sequentially recover from the significant pandemic-related declines in revenue and earnings in 2020. The company's revenue has benefitted from improved demand as coronavirus related restrictions eased and consumers attended more in-person events,” Moody’s said in a press release.

The agency noted cost savings, efficiency measures and a significant reduction in inventory that together delivered higher margins and strong free cash flow that was used to repay all revolver borrowings and boost its cash position.

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