Moody’s upgrades Nordgold’s ratings
Ratings agency Moody’s Investors Service has upgraded global gold miner Nordgold’s corporate family rating to Ba1 from Ba2 and its probability of default rating to Ba1-PD from Ba2-PD.
Additionally, Moody’s upgraded the company’s senior unsecured $400-million five-year Eurobond – which matures in 2024 – to Ba1 from Ba2.
The agency maintains a stable outlook on both entities.
Moody’s says its decision to upgrade Nordgold’s rating reflects the company’s record of deleveraging; its operational and geographical diversification, with its nine active mines across Burkina Faso, Guinea, Russia and Kazakhstan; its good reserve base; and its competitive operating costs.
The agency says Nordgold has a history of organic growth and shows good corporate governance.
The upgraded ratings are also based on the agency’s expectation that Nordgold will continue to deliver a strong operating performance, which will allow it to maintain modest levels of leverage in various gold price scenarios.
Moody’s also took into account Nordgold’s dividend policy, which anticipates high dividend distributions starting in 2022 – which entails 50% of the company’s pre-dividend free cash flows, adjusted by the amount of the development capital spending, provided that Nordgold’s net debt to earnings ratio is below 1.5 times.
Nordgold intends to pay $400-million in dividends for 2021.
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