Moody's cuts Great Lakes Dredge

Moody's Investors Service said it downgraded Great Lakes Dredge & Dock Corp.'s ratings, including its corporate family rating to B3 from B2 and probability of default rating to B3-PD from B2-PD.

Concurrently, Moody's lowered the ratings on the company's unsecured notes due 2019 to Caa1 from B3. Great Lakes' speculative grade liquidity rating was affirmed at SGL-3.

The outlook was changed to stable from negative.

Moody's said the downgrade was prompted by Great Lakes' weaker-than-expected operating performance and Moody's view that, notwithstanding some improvement expected during the second half of 2013, the company's credit metrics will likely remain at levels more reflective of a B3 rating.

Uncertainty regarding the degree of intermediate term free cash flow improvement, weaker than expected cash balances and tight covenant headroom were also considered in the downgrade.

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