S&P turns Oceaneering view to positive

S&P said it revised its outlook for Oceaneering International Inc. to positive from stable and affirmed the BB- ratings on the issuer and its senior unsecured notes. The 3 recovery rating on the notes is unchanged, indicating meaningful (50%-70%; rounded estimate: 65%) recovery in default.

The positive outlook reflects a forecasted improvement in Oceaneering’s credit profile over the next 12 months.

“While the recovery in the demand and pricing for offshore oilfield service firms has lagged that of their onshore peers, the sector is now showing signs of a more sustained pick-up. This is underpinned by the supportive commodity price outlook, global refocusing on energy security, and tight supply levels. As such, we have revised our projections for Oceaneering and now anticipate stronger credit measures over the next 12 to 24 months, particularly in the second half of 2023 and into 2024, as the company benefits from increasing revenue and cash flows, lower debt, a large cash balance, and its conservative financial policies,” S&P said in a press release.

The agency said it now estimates the company's average FFO to debt will near 45% in 2023 and exceed 60% in 2024.

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