Moody’s Investors Service lowered its ratings on Danbury furniture retailer Ethan Allen Interiors Inc. to reflect a projected decline in the company’s debt protection measures due to the troubled economy.
Moody’s lowered Ethan Allen’s corporate family rating, probability of default rating and senior unsecured notes rating all to “Ba2,” or two notches below investment grade.
Moody’s said the one-notch downgrade is based on medium- to long-term expectations of the furniture seller’s operating results and credit quality.
Still, the agency said its outlook was stable, reflecting its expectation “that management actions taken over the past year will lead to improving profitability and operating cash flow over the next several quarters.”
Moody’s anticipates the company will benefit from more stable consumer spending trends and the company’s move toward selling custom order case goods, Moody’s Senior Credit Officer Kevin Cassidy said.
The rating agency added that Ethan Allen’s liquidity is stable and should improve. (AP)
