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Alumina's credit rating under scrutiny
Edited by : AL CIRCLE
1 min read
S&P has placed Alumina's BBB credit rating on a negative watch, after the average aluminium price dropped by almost 20 per cent in the first three months of 2012.
"The credit watch placement reflects our concerns that current challenging trading conditions could weaken Alumina's financial metrics to levels below our expectation for the BBB rating," S&P credit analyst May Zhong said in a statement.
"If currently soft aluminum and alumina prices, higher input costs, and the strength of the Australian dollar were to persist, it will pressure Alumina's key cash flow metrics in 2012."
Alumina posted underlying earnings of $US128 million ($A123.64 million) in calendar 2011, up 55 per cent from 2010. Its shares were down 1.5 cents, or 1.2 per cent, at $1.195 at 1218 AEDT.
"The credit watch placement reflects our concerns that current challenging trading conditions could weaken Alumina's financial metrics to levels below our expectation for the BBB rating," S&P credit analyst May Zhong said in a statement.
"If currently soft aluminum and alumina prices, higher input costs, and the strength of the Australian dollar were to persist, it will pressure Alumina's key cash flow metrics in 2012."
Alumina posted underlying earnings of $US128 million ($A123.64 million) in calendar 2011, up 55 per cent from 2010. Its shares were down 1.5 cents, or 1.2 per cent, at $1.195 at 1218 AEDT.
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