Moody's ups Great Lakes outlook to positive

Moody's Investors Service said it has changed the outlook of Great Lakes Dredge & Dock Corp. to positive from stable and affirmed the company's existing ratings, including the B3 corporate family and probability of default ratings.

The change in outlook reflects the company's strong credit metrics for its current rating category, healthy backlog and progress that Great Lakes has made toward repositioning some of its assets to the Middle East, where greater demand for dredging work exists, the agency said.

The asset repositioning and some domestic contract awards have helped backlog increase to $472 million at Sept. 2008 from $361 million at Dec. 2007, Moody's said, adding that the higher backlog, coupled with an expectation of lower capital spending, and lower net working capital increases in 2009 suggest the potential for free cash flow generation and improving credit metrics which may support a higher rating level.

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