DBRS lowers Teck Resources

DBRS Ltd. said it downgraded the issuer rating and senior unsecured notes rating of Teck Resources Ltd. to BB (high) from BBB and has maintained the negative trends.

DBRS said the downgrade reflects the substantial weakening of the company’s financial metrics (especially its coverage metrics), which have fallen to well below investment-grade levels mainly due to large declines in key commodity prices, which are expected to remain weak in the near term.

Additionally, Teck continues to fund its share of the Fort Hills oil sands project, which is expected to utilize construction funds through to the end of 2017, further depleting the company’s financial resources.

In addition, DBRS said it has established a recovery rating of RR3 for Teck’s senior unsecured notes, which corresponds to an estimated 60% to 80% recovery of principal amounts of the senior unsecured notes under a hypothetical default scenario

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.