S&P lowers Northwest view to negative

S&P said it revised the outlook on Northwest Acquisitions ULC to negative from stable.

The agency also affirmed the company's ratings, including its B+ long-term issuer credit rating.

The outlook revision primarily reflects an expectation that Northwest will generate earnings and cash flows below previous estimates in 2018 and 2019, S&P explained.

Lower rough diamond production and unit costs are primarily responsible for this, leading to leverage ratios considered weak for the rating, the agency said.

S&P said it expects 2019 rough diamond output to come in much lower than 2018 levels.

The negative outlook reflects the increase in Northwest's estimated leverage metrics, the agency said, and a view of the company's heightened dependence on higher rough diamond prices and lower unit costs to generate stronger credit measures.

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