Moody?s Ratings Improve for Arkansas Best

Moody’s Investors Service assigned a Baa3 rating on June 3 to Arkansas Best Corp.’s $225 million senior unsecured revolving credit facility, due in 2005, which replaced the $250 million revolving credit due 2003. Moody’s also confirmed the senior implied rating at “Baa3.” The rating outlook remains stable, according to a Reuters report.

The ratings reflect the company’s strong performance over the past several years while recognizing the negative impact of the nation’s economic slowdown over the last eight quarters. Productivity measurements, while weaker today, still show long-term improvement.

Reuters said Arkansas Best’s much improved balance sheet, with the increase in retained earnings and reduction in debt, further support the ratings. Moody’s expects a return to a more solid performance with the cyclical return of a stronger economy. While the industry fundamentals have not been favorable since mid 2000, Moody’s said, Arkansas Best has demonstrated ability to reasonably adjust its cost base consistent with freight volume demand levels considering its higher level of fixed costs typical of less-than-truckload carriers.