Mexico’s large miners can withstand impact of coronavirus 3-month shutdown

Mexican mining companies Grupo Mexico, Industrias Penoles and Fresnillo can withstand the impact of a shutdown of up to three months because they have sufficient “financial flexibility,” S&P Global Ratings said on Thursday.

The Mexican government declared a health emergency at the end of March and ordered the suspension of non-essential economic activities, including mining, to curb the spread of the novel coronavirus in Latin America’s second-largest economy.

“In our opinion, these companies are able to absorb a drop in EBITDA of 15% to 20% before a potential rating action, which translates into around three months of mine closure,” the ratings agency said.

(By Diego Ore and Anthony Esposito; Editing by Chris Reese and Granr McCool)