Moody's upgrades Arinc

Moody's Investors Service said it raised the corporate family and probability of default ratings of Arinc Inc. to B2 from B3.

The agency also said it affirmed the B1 rating on the company's first-lien senior secured credit facilities and upgraded the rating on the company's second-lien senior secured credit facility to Caa1 from Caa2.

The outlook was revised to positive from stable.

The upgrades reflect the sustained multi-year improvement in the company's EBITDA margin, particularly in its commercial operations and credit metrics, Moody's said.

The combination of the improved operating cash flow and modest capital expenditures of about 2.5% of revenues provide a recurring base of free cash flow, which the agency said it anticipates the company will maintain going forward.

The free cash flow profile and unrestricted cash on hand of at least $40 million anchor Arinc's good liquidity, which supports the upgrade of the ratings, Moody's said.

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