Diamond and jewelry retailer Signet Jewelers Ltd. recently reported stabilized operating performance and strong holiday season. The company also utilized its free operating cash flow (FOCF) to repay the outstanding balance on its revolving credit facility, further improving credit metrics. As are accordingly revising the outlook to positive from negative and are affirming our 'B+' issuer credit rating on Signet. The positive outlook reflects that we could raise our ratings on Signet over the next 12 months if it continues to improve operating performance, maintains leverage in the 3x area on a sustained basis, and adequately address preferred share interest. In addition, adjusted EBITDA margins meaningfully improved over the same period (Chart 2). Moreover, better-than-expected operating performance and lower capital