Fitch lowers Magnitogorsk Iron view to negative

Fitch Ratings said it revised the outlook on OJSC Magnitogorsk Iron & Steel Works' long-term issuer default rating to negative from stable and affirmed the rating at BB+.

The agency has also affirmed the company's short-term issuer default rating at B, local-currency long-term issuer default rating at BB+ and long-term national rating at AA(rus).

The outlook revision is due to the increase in the company's leverage in 2011 above previous expectations, Fitch said.

This was because of the increase in the relative iron ore purchase price versus steel-products selling prices and the underutilization of newly-launched facilities in Turkey, the agency said.

Fitch noted the healthy performance of the main steel consuming industries in Russia in 2011, which resulted in an increase in apparent steel products consumption by 16% in 2011 year-over-year.

© 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.