Moody’s downgrades Ausdrill

Moody's Investors Service said it downgraded Ausdrill Ltd.’s corporate family rating to B1 from Ba3.

At the same time, the agency downgraded the senior unsecured rating of Ausdrill Finance Pty. Ltd. to B2 from B1.

The outlooks are negative.

"The downgrade in the ratings reflect the continued challenging conditions for mining services companies and which is leading to Ausdrill's credit profile deteriorating to a level that is no longer consistent with the previous rating," Moody's analyst Saranga Ranasinghe said in a news release.

"Our expectation is that operating conditions for mining services companies will remain weak through 2016 as mining companies will continue to focus on cost saving programs and the deferral of non-essential capital expenditure, increasing uncertainty around Ausdrill's ability to improve earnings and delever."

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