Fortescue Metals Group Ratings Lowered On Expected Weaker Financial Position, Outlook Negative

MELBOURNE (Standard&Poor's) April 22, 2015--Standard&Poor's Ratings Services said today that it had lowered its corporate credit rating on Fortescue Metals Group Ltd. to 'BB' from 'BB+'. The outlook is negative. At the same time, we lowered the ratings on the company's senior secured debt to 'BBB-', from 'BBB', and the senior unsecured rating to 'BB-' from 'BB'. The recovery rating remains unchanged at '1' for the senior secured debt rating, and '5L' for the senior unsecured debt. We have also removed all ratings from CreditWatch with negative implications. "The downgrades reflect our expectation that Fortescue's financial risk profile will weaken significantly in the next two years due to low iron ore prices," said Standard&Poor's

...MELBOURNE (Standard & Poor's) April 22, 2015--Standard & Poor's Ratings Services said today that it had lowered its corporate credit rating on Fortescue Metals Group Ltd. to '##' from '##+'. The outlook is negative. At the same time, we lowered the ratings on the company's senior secured debt to '###-', from '###', and the senior unsecured rating to '##-' from '##'. The recovery rating remains unchanged at '1' for the senior secured debt rating, and '5L' for the senior unsecured debt. We have also removed all ratings from CreditWatch with negative implications. "The downgrades reflect our expectation that Fortescue's financial risk profile will weaken significantly in the next two years due to low iron ore prices," said Standard & Poor's credit analyst May Zhong. We have revised our assessment of Fortescue's financial risk profile to "aggressive" from "significant" because we expect the company's adjusted debt to EBITDA to approach 4.5x and funds from operations (FFO) to debt to fall to...

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