...- U.S.-based Del Monte Foods Inc. (DMFI) posted strong third-quarter (ended Jan. 31, 2021) results, demonstrating continued operating improvement driven by the realization of cost savings and strong branded sales growth. The company improved its trailing 12-month leverage to 5.3x at the end of the quarter compared with 7.7x for the 12 months ended Oct. 31, 2020, and the low-teens area at the end of the fiscal year ended April 30, 2020. - We are raising our issuer credit rating on DMFI to 'B-' from '###+' as a result of our forecast for continued good operating performance and de-leveraging. We no longer believe the company's capital structure is unsustainable. - We are also raising our issue-level rating on DMFI's debt to 'B-' because of the issuer credit rating upgrade. The recovery remains '3', indicating our expectation for meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a default. - The positive outlook reflects the possibility that we could raise the ratings over...
