S&P stabilizes AngloGold Ashanti view

S&P said it revised its outlook for AngloGold Ashanti Ltd. to stable from positive and affirmed the BB+ global scale long-term issuer credit and issue ratings on AngloGold Ashanti and the senior unsecured debt issued by AngloGold Ashanti Holdings plc and the zaAAA/zaA-1+ South Africa national scale ratings.

“We expect AngloGold Ashanti will maintain low leverage during periods of lower gold prices, but see upward pressure on both country risk and costs. The BB+ rating primarily reflects our expectation that the company will maintain strong credit measures over the next few years, which includes gold price assumptions significantly below current levels,” S&P said in a press release.

The agency said it estimates AngloGold Ashanti's adjusted debt to EBITDA (leverage) at below 1.5x and FFO to debt above 60% on a sustained basis.

“Our expectation is supported by the company's conservative financial policy, which includes a commitment to maintaining reported net debt to EBITDA below 1x through the cycle, and a dividend policy of 20% of FOCF before growth capital expenditure (capex). At the same time, our assessment of business risk is constrained by elevated costs lowering operating efficiency, and rising country risk,” S&P said.

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