Moody's cuts Massey Energy to negative

Moody's Investors Service said it lowered Massey Energy Co.'s outlook to negative from stable and affirmed all ratings.

Moody's affirmed Massey's $335 million 6.625% guaranteed senior unsecured notes due Nov. 15, 2010 at Ba3; $175 million 2.25% guaranteed senior unsecured convertible notes due April 1, 2024 at Ba3; $239 million 6.95% guaranteed senior unsecured notes due March 1, 2007 at B1; $132 million 4.75% guaranteed senior unsecured convertible notes due May 15, 2023 at B1; senior implied rating at Ba3; and issuer rating at B2.

Moody's said the change in outlook was prompted by Massey's inability to increase 2004 production to the targeted level of 45 to 47 million tons, which is necessary to cover the company's high fixed costs and generate consistent operating earnings.

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