S&P affirms Parker Drilling

Standard & Poor's said it affirmed its BB- senior secured debt, B- senior unsecured debt, CCC+ subordinated debt and B corporate credit ratings on Parker Drilling Co. and revised its outlook on the company to stable from negative.

The outlook revision reflects the fact that Parker is nearing the completion of its debt reduction goal, with about $180 million of its $200 million debt reduction accomplished to date primarily from proceeds of its planned assets sales, the agency said.

Moreover, S&P said it expects current favorable drilling market fundamentals to continue through the remainder of 2005, which should result in the continuing gradual improvement in Parker's credit protection measures, liquidity and overall financial profile and further support the outlook revision to stable.

The ratings on Parker reflect the company's high debt leverage and participation in the highly competitive, cyclical and volatile oil and gas contract drilling industry in areas of high political risk, S&P said.

The agency said these weaknesses are slightly mitigated by a diversified rig fleet and adequate near-term liquidity for capital spending and debt service.

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