S&P downgrades DynCorp

Standard & Poor's said it lowered the corporate credit rating on DynCorp International Inc. to B+ from BB-, along with its secured debt to BB- from BB and on its unsecured debt rating to B- from B.

The respective 2 and 6 recovery ratings remain unchanged, S&P said.

The outlook is stable.

The downgrades reflect slower-than-expected improvements in the company's credit protection measures following a leveraged buyout in July 2010 due to contract losses and lower profitability, the agency said.

The ratings reflect its aggressive financial profile following the buyout, increased price competition, limited contract diversity, the risky nature of some of the company's operations and possible changes in U.S. foreign policy, S&P said.

The ratings benefit somewhat from the firm's leading market positions and high demand for its services, the agency said.

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