Moody's downgrades J.B. Poindexter

Moody's Investors Service said it lowered J.B. Poindexter & Co. Inc.'s corporate family rating to B2 from B1 and $200 million of 8.75% guaranteed senior unsecured notes due March 2014 to B3 from B1. The speculative grade liquidity rating is unchanged at SGL-1. The outlook was changed to stable from negative.

The downgrades reflect the company's lower operating performance during 2005, which Moody's said was driven by lower customer orders at its step van operation, lower pick-up truck sales in the United States and Canada, lower consumer rental orders and higher raw material costs, which were not passed onto customers.

Additionally, J.B. Poindexter's three acquisitions over the past eighteen months have increased sales, but have not improved profitability nor free cash flow to date, the agency said.

The stable outlook reflects the company's stronger backlog going into 2006 and price increases implemented by the company to offset increased costs. Moody's said these developments are expected to enable the company to produce credit metrics consistent with the B2 corporate family rating during the near term.

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