CSC credit rating takes a hit

Standard and Poor’s has lowered Computer Sciences Corp.’s credit rating in the wake of poor fiscal 2012 results and concerns of continuing troubles with a large United Kingdom contract.

S&P lowered CSC’s rating from BBB+ to BBB, which means the credit agency believes the company has “adequate capacity to meet financial commitments but more subject to adverse economic conditions.”

Among the conditions S&P cited in its decision are a number of underperforming contracts the company has identified and “prolonged weakness” in the European economy and the U.S. federal sector.

Tops among the troubled contracts are CSC’s issues with the U.K. National Health Service contract that contributed to the company reporting a $4.2 billion loss from continuing operations, S&P said.

CSC also has announced plans to launch $1 billion cost-reduction program.

Overall, S&P is estimating that CSC will have low-to-single-digit revenue declines in fiscal 2013. Excluding the impact of the U.K. contract, the company should have margins of 10 percent, compared to historical margins of 14 percent.

About the Author

Nick Wakeman is the editor-in-chief of Washington Technology. Follow him on Twitter: @nick_wakeman.

Reader Comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above

What is your e-mail address?

My e-mail address is:

Do you have a password?

Forgot your password? Click here
close
SEARCH
contracts DB

Trending

  • Dive into our Contract Award database

    In an exclusive for WT Insider members, we are collecting all of the contract awards we cover into a database that you can sort by contractor, agency, value and other parameters. You can also download it into a spreadsheet. Read More

  • Is SBA MIA on contractor fraud? Nick Wakeman

    Editor Nick Wakeman explores the puzzle of why SBA has been so silent on the latest contractor fraud scandal when it has been so quick to act in other cases. Read More

Webcasts

  • How Do You Support the Project Lifecycle?

    How do best-in-class project-based companies create and actively mature successful organizations? They find the right mix of people, processes and tools that enable them to effectively manage the project lifecycle. REGISTER for this webinar to hear how properly managing the cycle of capture, bid, accounting, execution, IPM and analysis will allow you to better manage your programs to stay on scope, schedule and budget. Learn More!

  • Sequestration, LPTA and the Top 100

    Join Washington Technology’s Editor-in-Chief Nick Wakeman as he analyzes the annual Top 100 list and reveals critical insights into how market trends have impacted its composition. You'll learn what movements of individual companies means and how the market overall is being impacted by the current budget environment, how the Top 100 rankings reflect the major trends in the market today and how the biggest companies in the market are adapting to today’s competitive environment. Learn More!