S&P cuts Expro

Standard & Poor's said it lowered the corporate credit rating on Expro Holdings U.K. 3 Ltd. to B- from B.

The agency also lowered Expro's $1.35 billion bank loan to B from B+, while the company's $100 million revolver was lowered to BB- from BB and its $777 million mezzanine facility to CCC+ from B-. The recovery ratings on these instruments are unchanged at 2, 1+, and 5, respectively, indicating an expectation of 70% to 90%, 100% and 10% to 30% recovery in a default.

The agency also said it lowered the $1.4 billion senior secured notes issued by related entity Expro Finance Luxembourg SCA to B from B+. The recovery rating is unchanged at 2, reflecting an expectation of 70% to 90% recovery in a default.

The outlook remains negative.

The downgrade follows Expro's weaker-than-anticipated financial performance in financial 2009-2010 that has subsequently continued in the first quarter of the current financial year, S&P said.

The ratings primarily reflect the company's highly leveraged financial risk profile, mitigated to a degree by its fair business risk profile, the agency said.

Key constraints include Expro's high debt levels, weaker-than-anticipated cash flow generation and expected limited deleveraging over the next two years, S&P added.

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