S&P downgraded the company’s corporate credit rating to CCC from CCC+, its secured note rating from B to B- and its unsecured note rating to CCC from CCC+.

Boart CEO Richard O’Brien said the action did not impact any of the company’s bank covenants and put ratings on par with Moody’s.

“We recognise that the recent downgrades by the ratings agencies may present concerns for our creditors and other stakeholders and we are committed to addressing those concerns as promptly as possible through the completion of the strategic review of recapitalisation options we previously announced and continue to actively pursue,” he said.

Earlier this month, Boart was forced to deny its review had been unsuccessful and it was heading for administration.

O’Brien said that despite the headwinds of lower demand for exploration and drilling services, Boart’s underlying franchise remained strong and continued to generate positive cashflow.

“We have the liquidity and financial resources to fund all of our operations for the foreseeable future, including meeting our obligations to our suppliers and other creditors, and we are confident we will be able to identify an effective solution to our capital structure,” he said.

“We remain committed to providing our clients with the industry’s highest level of service and best products and to have mutually beneficial relationships with all of our suppliers and business partners, as we have in the past.”

Utah-based, Australia-listed Boart reported a 47% drop in revenue, negative earnings and low rig utilisation rates for the March quarter and is yet to release June results.

The company’s shares went to a record low of A8.7c last week, a massive 99.6% slump from its October 2007 all-time high of $21.86.

It shares jumped 15% yesterday to 10c on heavy volume.