S&P trims Diamond Offshore

S&P said it lowered its corporate credit rating on Diamond Offshore Drilling Inc. to BB- from BB+. The outlook is negative.

S&P also lowered its issue-level rating on the company's unsecured debt to BB- from BB+. The recovery rating remains 3, indicating an expectation for meaningful (50%-70%; lower half of the range) recovery in the event of a payment default.

“The downgrade reflects our revised assessment of Diamond's business risk profile and our revised assumptions for utilization of the company's uncontracted fleet, in light of continued weak market conditions,” said S&P credit analyst Carin Dehne-Kiley in a news release. “As a result, we have increased our expectations for the company's leverage in 2018 and 2019.”

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