CHICAGO -- Duff & Phelps Credit Rating Co. here has lowered its rating of Dixie Yarns Inc.'s convertible subordinated debentures to double-B-plus from triple-B-minus, affecting $45 million of debt.

Duff & Phelps noted Dixie's poor textile performance and said it expects improvement will be difficult given the tough textile environment.

The credit rating firm cited the company's weak operating results due to soft markets, higher cotton costs and operating difficulties.

Dixie, however, has cut costs, strengthened management, deferred capital spending and further reduced working capital, Duff & Phelps said, adding that it expects management's turnaround efforts will lead to improvements over the near term.

Dixie lost $4.3 million in the first quarter against earnings of $900,000 a year earlier. A $7.1 million operating loss by the textile business was partially offset by $4.8 million earned in its floor covering operation.

To continue reading this article...

To Read the Full Article

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus