From 'D' Rating to BBB+, A Long-Term Credit Turnaround

Background

An oilfield and energy services company operating in a cyclical and capital-intensive sector had been downgraded to 'D', the lowest possible credit rating, following a period of financial stress and payment defaults. The company subsequently underwent a complete change in ownership and management, marking a genuine operational and strategic reset.

Despite the new management's efforts, the legacy default history continued to cast a shadow over every credit assessment. What was needed was not a single rating outcome, but a long-term, structured strategy to rebuild credibility from the ground up and demonstrate that the turnaround was real, sustainable, and independently verifiable.

The Challenge

• A historical 'D' default record that continued to weigh on credit assessments despite new ownership
• Weak financial performance and losses in the years preceding the acquisition
• Rating agencies remained sceptical about the sustainability of the turnaround, beyond short-term improvements
• High scrutiny from analysts due to the sector's inherent cyclicality and capital intensity
• The engagement required a multi-year credibility-building strategy, not a one-time rating exercise

How Neofincred Helped

• Reframed the credit narrative post-acquisition, explicitly separating the legacy default history from the current management's performance and strategy
• Demonstrated operational revival and long-term sustainability through structured, data-backed presentations, going beyond short-term financial improvements
• Addressed concerns around defaults and historical losses with transparent, well-reasoned explanations rather than deflection
• Engaged continuously with multiple rating agencies across review cycles, maintaining consistent messaging and analytical discipline over several years
• Maintained disciplined information flow and credibility with agencies through every surveillance cycle
• Provided support for IPO-related rating monitoring and aligned the company's financial communication strategy with evolving market expectations

The Outcome

• Achieved BBB- post-acquisition, a first investment-grade rating despite the legacy default history
• Rating sustained and progressively improved across multiple surveillance cycles
• Achieved BBB+ in 2025, despite ongoing sector challenges and historical losses
• Lender confidence fully restored and long-term market credibility rebuilt
• Neofincred retained as sole credit rating advisor for over six years