S&P downgrades KLX

Standard & Poor’s said it downgraded KLX Inc. to B+ from BB.

The outlook is negative.

The downgrade reflects KLX’s lower forecasted credit metrics because of difficult operating conditions in its oilfield-services business and its acquisitive growth strategy, S&P said.

The agency said it believes that KLX’s credit ratios could deteriorate moderately from current levels as the company pursues acquisitions or repurchases its stock.

The negative outlook considers an expectation that the company’s earnings will increase modestly, driven by management’s cost-reduction efforts in its energy segment and increasing volumes in its aerospace segment, S&P said.

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