S&P Lowers Quiksilver Rating To B-

josh hunter

• March 17 2009
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• 2 comments

Nobody likes getting report cards. Well, I guess nerds do, and those obnoxious parents that slap bumper stickers touting their kids’ performance at school on their minivans. But Quiksilver isn’t a dork or a lame soccer mom, and today S&P sent out a not-so-great report card announcing that it had lowered the company’s rating “deeper into junk status” and placed them on “CreditWatch”.

Here’s the full release from the Associated Press:

Standard & Poor’s Ratings Services said Tuesday that it lowered its ratings on Quiksilver Inc. deeper into junk status as the outdoor clothing and equipment company works toward a deal to improve its liquidity and capital structure.

S&P lowered Quiksilver’s ratings to “B-” from “B+” and placed them on “CreditWatch,” which means the ratings could be cut further or raised after the credit agency’s review is complete.

Last week, Quiksilver said it extended the maturity of its 55 million euros ($71) line of credit to June 30 from March 14 to give the company more time to complete a strategic or refinancing deal.

“Our resolution of the CreditWatch listing will focus on Quiksilver’s ability to meet its near-term debt obligations, maintain adequate liquidity, and improve its operating business trends and financial metrics,” S&P said. “If the company can complete a refinancing or strategic transaction, then we may review the ratings for an upgrade.”

As of Jan. 31, the Huntington Beach, Calif.-based company had about $1.4 billion in adjusted debt, S&P said.

Quiksilver shares gained 12 cents, or 13 percent, to $1.04 in late afternoon trading. The stock has traded between 80 cents and $10.67 during the past 52 weeks.