S&P trims Gibson Energy outlook to negative

S&P said it revised its outlook on Gibson Energy ULC to negative from stable and affirmed its BB long-term corporate credit and senior unsecured debt ratings on the company. The 4 recovery rating on the debt is unchanged and indicates that lenders can expect average (30% to 50%; upper half of the range) recovery if a default occurs.

“We base the outlook revision on Gibson’s lower-than-expected revenue growth in the wake of the low oil prices,” said S&P credit analyst Gerry Hannochko in a news release.

“However, as projects come into service, we expect some strengthening in the business risk profile, from contracted, stable take-or-pay cash flows,” Hannochko added in the release.

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