Moody’s upgrades Barrick to Baa2 with stable outlook
Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) (Barrick or the “Company”) today reported that Moody’s Investors Service (“Moody's”) has upgraded the senior unsecured ratings of Barrick and all rated subsidiaries to Baa2 from Baa3, with a stable outlook.
In a news release announcing the upgrade, Moody’s cited Barrick’s low adjusted leverage, large scale, diverse and low-cost gold assets, free cash flow generation and favorable geopolitical risk profile, noting “Barrick's liquidity is excellent, which provides significant flexibility to maneuver through gold price volatility.”
“We are pleased that Moody’s has recognized our efforts to significantly reduce the Company’s total debt, while substantially improving liquidity and free cash flow generation,” said Barrick President Kelvin Dushnisky. “Over the past three years, we have reduced our total debt by more than 50 percent, from $13.1 billion at the end of 2014, to $6.4 billion today.”
The Company’s goal remains to reduce total debt to around $5 billion by the end of 2018, primarily by using cash flow from operations and cash on hand, and potentially through further portfolio optimization. Barrick will continue to pursue debt reduction with discipline, taking only those actions that make sense for the business, on terms favorable to the Company’s shareholders.
At the end of the fourth quarter, Barrick had a consolidated cash balance of approximately $2.2 billion. The Company has less than $100 million in debt due before 2020.1 More than three-quarters of Barrick’s outstanding total debt of $6.4 billion does not mature until after 2032.