S&P puts Ausdrill on watch

Standard & Poor's said it placed the long-term BB corporate credit rating on Ausdrill Ltd. on CreditWatch with negative implications.

The agency also said it placed the BBB- senior secured issue rating and BB senior unsecured ratings on CreditWatch negative.

Ausdrill has forecast a weaker operating performance for the year ending June 30, 2014, S&P said.

If Ausdrill's performance were to deteriorate further after fiscal 2014, this will worsen the company's financial credit metrics to the extent that the metrics may not support its current intermediate financial risk profile, said Craig Parker, an S&P analyst.

Ausdrill's business activity is reducing because of expiring contracts and decreasing overall demand, Parker said.

Parker said it will resolve the CreditWatch after reviewing the measures that Ausdrill will likely implement to assist in deleveraging the balance sheet in response to these weak market conditions.

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