Moody’s has lowered the corporate family rating of the parent company of Quiksilver, Boardriders, Element, Roxy, RVCA and DC Shoes from Caa1 to Caa2 and the senior secured credit facility rating from B3 to Caa1. The rating agency cited weak credit metrics, including a leverage ratio of nearly 8x and EBIT/interest expense coverage of 0.4x and the near-term maturity of the debt, as reasons for the downgrade. According to Moody’s, Boardriders’ spending on its business transformation has kept cash flow negative, although the agency sees overall liquidity adequate for the next 12 months. Following the downgrade, Moody’s raised its outlook for Boardriders from negative to stable, noting that revenue growth was positive and that sales in the most recent quarter exceeded pre-pandemic levels.

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