Moody’s lowers KLX to B1, notes to B2

Moody's Investors Service said it downgraded KLX Inc.’s corporate family rating to B1 from Ba2, probability of default rating to B1-PD from Ba2-PD and senior unsecured notes to B2 from Ba3.

The outlook is stable.

Moody’s said the downgrade reflects revenue and earnings pressures in KLXs' Energy Services Group, which continues to face challenging operating conditions in a low oil price environment.

The agency anticipates that energy market headwinds will persist through the balance of this year and into 2017. This is expected to result in continued margin and profit pressure and elevated leverage levels (Moody's adjusted debt-to-EBITDA of about 5 times as of January).

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