Great Lakes Receives S&P Global Ratings Upgrade to B-

Rhea-AI Summary

Great Lakes Dredge & Dock (NASDAQ: GLDD) announced that S&P Global Ratings has upgraded the company's issuer credit rating to 'B-' from 'CCC+'. The upgrade is based on improved revenue and profitability in the first half of 2024, as well as a strong backlog and recent awards that provide visibility into improved cash flows through 2025. S&P expects Great Lakes to continue expanding revenue and improving profitability throughout the remainder of 2024 and into 2025.

Scott Kornblau, Great Lakes' Senior VP and CFO, stated that the upgrade validates their efforts and positions the company for future growth and success. Great Lakes is the largest provider of dredging services in the US and is expanding into the offshore wind energy industry.

Positive

• S&P Global Ratings upgraded Great Lakes' issuer credit rating to 'B-' from 'CCC+'
• Improved revenue and profitability in the first half of 2024
• Strong backlog and recent awards provide visibility into improved cash flows through 2025
• Expected continued expansion of revenue and improved profitability for the remainder of 2024 and into 2025

Negative

• None.

Insights

Financial Analyst

The credit rating upgrade from S&P is a positive development for Great Lakes Dredge & Dock The improvement from "CCC+" to "B-" signifies enhanced creditworthiness and financial stability. This upgrade could lead to lower borrowing costs and improved access to capital markets, potentially benefiting the company's financial flexibility.

The upgrade is based on improved revenue and profitability in H1 2024, along with a strong backlog. This suggests the company's operational performance is on an upward trajectory. The stable outlook indicates S&P's confidence in continued expansion and profitability improvement through 2025, which bodes well for long-term growth prospects.

However, investors should note that while improved, a "B-" rating still indicates the company is vulnerable to adverse business conditions. It's important to monitor Great Lakes' ability to maintain this positive momentum and further strengthen its financial position.

Market Research Analyst

Great Lakes' position as the largest dredging services provider in the U.S. gives it a competitive edge in a niche market. The company's expansion into the offshore wind energy industry is particularly noteworthy, as it aligns with the growing trend towards renewable energy sources. This diversification could potentially open up new revenue streams and reduce reliance on traditional dredging services.

The company's 134-year history and perfect project completion record demonstrate reliability and expertise, which are important factors in winning contracts in the marine construction industry. The large and diverse fleet of approximately 200 specialized vessels is a significant asset, providing operational flexibility and capacity to handle various project types.

Investors should keep an eye on the company's ability to capitalize on infrastructure spending initiatives and offshore wind projects, as these could drive future growth. However, it's also important to consider potential risks such as economic downturns or regulatory changes that could impact the dredging and offshore wind sectors.

HOUSTON, Aug. 29, 2024 (GLOBE NEWSWIRE) -- Great Lakes Dredge & Dock Corporation ("Great Lakes" or the “Company”) (NASDAQ: GLDD), the largest provider of dredging services in the United States, announced today that the Company’s issuer credit rating has been upgraded to “B-” from “CCC+” by S&P Global Ratings (“S&P”).

S&P based its ratings upgrade in part due to the Company’s improved revenue and profitability in the first half of 2024. S&P also cited that the Company’s strong backlog and recent awards gives visibility into improved cash flows through 2025. The stable rating reflects S&P’s expectation that the Company will continue to expand revenue and improve profitability throughout the remainder of 2024 and into 2025.

Great Lakes’ Senior Vice President and CFO Scott Kornblau commented, “We are pleased with the recent credit rating upgrade from S&P, which further demonstrates the improvements we have made this year to our balance sheet, cash flows and overall performance. This upgrade not only validates our efforts but also positions us for future growth and success.”

The Company
Great Lakes Dredge & Dock Corporation (“Great Lakes” or the “Company”) is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 134-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.

Cautionary Note Regarding Forward-Looking Statements
Certain statements in this press release may constitute "forward-looking" statements as defined in Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), the Private Securities Litigation Reform Act of 1995 (the "PSLRA") or in releases made by the Securities and Exchange Commission (the "SEC"), all as may be amended from time to time. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of Great Lakes and its subsidiaries, or industry results, to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements that are not historical fact are forward-looking statements. These cautionary statements are being made pursuant to the Exchange Act and the PSLRA with the intention of obtaining the benefits of the "safe harbor" provisions of such laws. Great Lakes cautions investors that any forward-looking statements made by Great Lakes are not guarantees or indicative of future events.

Although Great Lakes believes that its plans, intentions and expectations reflected in this press release are reasonable, actual events could differ materially. The forward-looking statements contained in this press release are made only as of the date hereof and Great Lakes does not have or undertake any obligation to update or revise any forward-looking statements whether as a result of new information, subsequent events or otherwise, unless otherwise required by law.

For further information contact:
Tina Baginskis
Director, Investor Relations
630-574-3024

FAQ

What is Great Lakes Dredge & Dock 's new credit rating from S&P Global Ratings?

Great Lakes Dredge & Dock 's (GLDD) issuer credit rating has been upgraded to 'B-' from 'CCC+' by S&P Global Ratings.

Why did S&P Global Ratings upgrade Great Lakes Dredge & Dock 's credit rating?

S&P Global Ratings upgraded GLDD's credit rating due to improved revenue and profitability in the first half of 2024, strong backlog, and recent awards providing visibility into improved cash flows through 2025.

What is S&P's expectation for Great Lakes Dredge & Dock 's performance in 2024 and 2025?

S&P expects Great Lakes Dredge & Dock (GLDD) to continue expanding revenue and improving profitability throughout the remainder of 2024 and into 2025.

How does the credit rating upgrade affect Great Lakes Dredge & Dock 's future prospects?

The credit rating upgrade validates Great Lakes Dredge & Dock 's (GLDD) efforts to improve its balance sheet, cash flows, and overall performance, positioning the company for future growth and success.