Moody’s downgrades Cosmo Oil

Moody's Japan K.K. said it downgraded the issuer rating of Cosmo Oil Co. Ltd. to Ba2 from Ba1.

The outlook is negative.

"The rating downgrade principally reflects the lack of improvement in Cosmo Oil's leverage, despite the normalization of operations at its Chiba plant for more than a year," Kailash Chhaya, Moody's vice president and lead analyst for Cosmo Oil, said in a news release.

"Given its high leverage, the company has very little cushion to absorb any further weakness in earnings, or any unexpected contingencies in its operations. All this occurs in an extremely challenging operating environment."

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