S&P lowers Sibanye Gold view to stable

S&P said it revised the outlook on Sibanye Gold Ltd. to stable from positive and affirmed the B+ ratings.

The 3 recovery rating on the group's senior unsecured notes is unchanged.

S&P also said it lowered the South Africa national scale rating on Sibanye to zaA- from zaA.

The wage strike at Sibanye's South African gold operations materially hurt the company's first-quarter 2019 operating performance and cash flows, the agency said.

While cash generation from Sibanye's platinum-group metal operations largely covered gold operating costs, S&P said it believes the company's free cash flow and de-leveraging prospects for 2019 have weakened.

The stable outlook reflects a view that steady PGM production and favorable PGM basket prices should sustain Sibayne's funds from operations-to-debt between 20% and 30% through 2020 despite underperformance at its gold operations, the agency said.

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