S&P lowers Exterran Energy Solutions

S&P said it lowered its ratings on Exterran Energy Solutions LP to B+ from BB-, its senior secured debt to BB from BB+ and its senior unsecured debt to B from B+. The secured debt’s recovery rating remains 1 (rounded estimate: 95%), indicating and expecting very high recovery for lenders in default. The unsecured debt’s recovery rating is also unchanged at 5 (rounded estimate: 10%), indicating and expecting modest recovery for lenders in default.

“Exterran’s leverage increased in 2020; we expect it will stay elevated through 2022. Exterran’s revenue declined in 2020 due to adverse market conditions, offsetting cost reductions and improved margins, resulting in forecast S&P Global Ratings-adjusted year-end leverage of 4x, higher than our previous forecast of 2.9x,” S&P said in a press release.

The agency said it does not see Exterran fully recovering until the end of 2022.

The outlook is stable.

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