Moody's cuts Trico Marine ratings

Moody's Investors Service said it downgraded Trico Marine's ratings by one notch, assigning a stable rating outlook for the next 12 months. The outlook had been negative.

Moody's downgraded to Caa2 from Caa1 the $250 million of 8.875% senior unsecured notes due 2012, downgraded the senior implied rating to Caa1 from B3, and downgraded the senior unsecured issuer rating to Caa2 from Caa1.

Moody's said the downgrades reflect a need to calibrate the ratings to the likely 2004 outlook. The new ratings incorporate the possibility of a successful refinancing of the domestic bank facility. The ratings reflect exceedingly high leverage and ongoing absence of visible catalysts in the company's operating regions to generate cash flow sufficient to both fund capital spending and begin reducing debt.

Furthermore, while the refinancing of Trico Marine's bank facilities would avoid a bank covenant default it would also add incremental first secured debt to the capital structure. If Trico Marine were to repatriate liquidity from its Norwegian operation, this might be funded by higher secured debt on the Norwegian fleet.

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