Research Update: Coronado Global Resources Inc. Outlook Revised To Stable On Improving Liquidity; 'B-' Rating Affirmed

We forecast Australia-based coal company Coronado Global Resources Inc. will generate positive free cash flow in fiscal 2021 after a strong rebound of metallurgical (met) coal prices in recent months, which should improve its liquidity position. That said, we expect coal prices to normalize next year, which should moderate free cash outflow, lifting the company's adjusted debt-to-EBITDA ratio to around 3x-4x in 2022 from an estimated 2x this year. On Aug. 11, 2021, S&P Global Ratings revised its outlook on Coronado to stable from negative. At the same time, we affirmed the 'B-' long-term issuer credit rating on Coronado and the 'B' long-term issue rating on the guaranteed senior secured notes due 2026. The stable outlook reflects our view that

...- We forecast Australia-based coal company Coronado Global Resources Inc. will generate positive free cash flow in fiscal 2021 after a strong rebound of metallurgical (met) coal prices in recent months, which should improve its liquidity position. - That said, we expect coal prices to normalize next year, which should moderate free cash outflow, lifting the company's adjusted debt-to-EBITDA ratio to around 3x-4x in 2022 from an estimated 2x this year. - On Aug. 11, 2021, S&P Global Ratings revised its outlook on Coronado to stable from negative. At the same time, we affirmed the 'B-' long-term issuer credit rating on Coronado and the 'B' long-term issue rating on the guaranteed senior secured notes due 2026. - The stable outlook reflects our view that Coronado will continue building a liquidity buffer as met coal prices remain elevated....

Research Update