Moody's cuts Griffin Coal view to negative

Moody's Investors Service said it affirmed the Ba2 corporate family and Ba2 senior unsecured ratings of The Griffin Coal Mining Co. Pty Ltd.

The outlook has been changed to negative from stable.

The affirmation and change in outlook follows Griffins decision to upsize its recent $400 million bond issue by $50 million, given the additional debt reduces Griffin's financial flexibility within its current rating, Moody's said.

The ratings reflect Griffin's strong coal reserves, low extraction cost base and sound long-term off-take contracts, including an adjacent power station, which underpin the strength and stability of its profit and cash flows, the agency said.

However, Moody's added, offsetting these operating strengths are financial metrics that will remain weak in coming years pending development of new revenue streams, execution risks related to the power project and potential weakness in corporate governance given a lack of independent directors.

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