S&P revises W&T outlook to negative

S&P said it revised its outlook for W&T Offshore Inc. to negative from stable and affirmed all its ratings, including the B- issuer rating.

“The negative outlook reflects our expectation for reduced cash flow generation in 2024 as natural gas prices remain weak and W&T completes its contracted acquisitions. We forecast the company's credit metrics will remain consistent with its prior-year levels, though somewhat weak for the rating, with S&P Global Ratings-adjusted funds from operations (FFO) to debt of about 15% in 2024 and debt to EBITDA of about 4.5x,” S&P said in a press release.

The agency said it forecasts W&T to generate negative FOCF of about $50 million in 2024, but lower capital expenditures should enable the company to deliver about breakeven FOCF in 2025.

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