1st Nov 2018 17:29
LONDON (Alliance News) - Moody's Investors Service said on Thursday it has placed its group and subsidiary ratings on Rio Tinto PLC on review for upgrade.
"The review results from the strengthening Rio Tinto's metrics attributable to its debt reduction in recent years under its liability management program, the reduction in costs from the group's focus on productivity and logistics, which helps to mitigate cost creep being seen in input costs," said Moody's.
The ratings agency also noted a recovery in prices over 2017 and 2018 has benefited the miner.
The review - of Rio Tinto's A3 senior unsecured and P-2 short-term ratings - will consider the dual-listed firm's asset base, commodity diversification, cost structure, and strategic growth targets.
Factors that could lead to an upgrade include a sustained debt to earnings before interest, taxes, depreciation and amortisation ratio of no more than 1.5 times and an earnings before interest and tax margin of at least 25%, Moody's said.
Shares in the FTSE 100 constituent closed up 0.8% at 3,834.717 pence on Thursday.
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