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March 4, 2016, 3:44 a.m. EST

Moody’s slashes BHP Billiton’s credit rating

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By Alex MacDonald

Getty Images
A truck passes a huge pile of coal at a BHP Billiton coal mine in Australia.

LONDON — BHP Billiton Ltd. suffered a credit-rating cut from Moody’s Investors Service on Thursday, ratcheting up pressure on the world’s largest mining company amid a prolonged slump in commodity prices.

Moody’s cut BHP’s /quotes/zigman/180893/delayed AU:BHP +0.50%   /quotes/zigman/184879/delayed UK:BLT -2.98%  credit rating two notches, to A3 from A1, a blow to the Anglo-Australian company that had long been viewed as a steady profit machine with a strong balance sheet. The move follows a ratings cut by Standard & Poor’s Ratings Services, which downgraded BHP by one notch.

The ratings downgrades come after BHP Billiton recorded a $5.67 billion first-half loss due in part to a massive write down of U.S. energy assets. The company scrapped its progressive dividend policy and cut its capital expenditure in a bid to shore up its finances, but Moody’s said a prolonged downturn in commodity prices would continue to crimp earnings for a long time to come.

“Moody’s views there to have been a fundamental downward shift in the global mining sector, with the downturn being deeper and the recovery likely to take longer than previously expected,” the agency said in a news release.

An expanded version of this report appears on WSJ.com.

AU : Australia: Sydney
$ 33.88
+0.17 +0.50%
Volume: 6.58M
May 23, 2018 4:27p
P/E Ratio
Dividend Yield
Market Cap
$108.27 billion
Rev. per Employee
UK : U.K.: London
1,726.20 p
-53.00 -2.98%
Volume: 16.64M
May 23, 2018 3:42p
P/E Ratio
Dividend Yield
Market Cap
£37.58 billion
Rev. per Employee

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