SYDNEY (AFX-ASIA) – Standard and Poor’s has raised its long-term corporate credit ratings on BHP Billiton Ltd and BHP Billiton PLC to “A+” from “A”, citing its excellent market position, portfolio diversification, strong cost profile, conservative financial policies and successful integration.
In a statement, S&P also affirmed BHP Billiton’s short-term corporate credit ratings at “A-1”, with the company having a “stable” ratings outlook.
S&P has also raised the related long-term ratings of Stein Insurance Co (Jersey) Ltd and BHP Billiton Marine & General Insurances Pty Ltd to “A+” from “A”.
Offsetting the key credit positives for BHP Billiton are the company’s exposure to volatile commodity prices and a measured exposure to higher risk emerging markets.
“The above-average business profile and strong financial performance of the merged BHP Billiton underpins the rating upgrade,” S&P credit analyst Craig Parker said.
He said key financial ratios supporting the strong credit rating are a net debt-to-net debt plus equity ratio of 34%, EBITDA interest cover ratio of 11 times and funds from operations to debt of 47%.