Rio Tinto's rating boosted to A at Fitch

Business 7/13/2018, 8:29 PM
Rio Tinto's rating boosted to A at Fitch

Fitch Ratings upgraded on Friday Rio Tinto Group's long-term default and senior unsecured debt instrument ratings to A from A- with a stable perspective. The credit appraiser noted the Anglo-Australian mining powerhouse's improved cash flow generation and asset sales "in a supportive economic environment" with strong commodity prices.

"Management is pursuing a value-over-volume strategy and we expect earnings growth to mainly come from productivity improvements, technological innovation, cost control and development projects from Rio Tinto's own pipeline. Management emphasizes disciplined capital allocation, which means the group's asset portfolio should evolve over time without a material shift in the underlying business risk," the announcement says.

Analysis showed the company has slightly lower cash cost and sustaining capital expenditure in iron ore than BHP. It trades as Rio Tinto Ltd. in Sydney and Rio Tinto Plc at the London Stock Exchange. The short-term rating was raised to F1 from F2.

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