Moody's lifts Carrol's notes to B3

Moody's Investors Service said it upgraded Carrol's Corp.'s $180 million guaranteed senior subordinated notes to B3 (LGD5, 75%) from Caa1 (LGD5, 79%) to reflect a reduction in the amount of senior secured debt in the company's overall liability structure. The B2 corporate family rating was affirmed.

The outlook is stable.

The agency said the B2 corporate family rating reflects Carrol's relatively high leverage, modest coverage and marginal free cash flow generation.

The ratings are supported by Carrol's brand diversification, its position as the largest Burger King franchisee, the improvement in same-store sales at its company-owned Burger King restaurants and the continued trend of positive same-store sales at Pollo Tropical and Taco Cabana, Moody's said.

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