The ASX and JSE share price of mining major BHP Billiton fell on Tuesday after ratings agency Standard & Poor’s (S&P) lowered the miner’s credit ratings from A+ to A.
The rating on BHP Billiton’s senior secured notes has been lowered from A+ to A and subordinated notes from A- to BBB+.
This follows a warning in January by the company that it expected to recognise an impairment charge of approximately US$4.9 billion post-tax (or approximately $7.2 billion pre-tax) against the carrying value of its onshore US assets, which will be recognised as an exceptional item in the financial results for the half year ended 31 December 2015.
BHP Billiton has also been placed on ‘CreditWatch with negative implications’ and S&P has advised it aims to resolve the CreditWatch after the release of BHP Billiton’s results for the half year ended 31 December 2015.
BHP Billiton said in a statement that it has the strongest credit rating in the sector and remains committed to maintaining its strong balance sheet through the cycle.
The company’s shares closed at low of A$14.90 a share on Tuesday from a high of A$15.20, a fall of 2.16%.