The confirmation of the Issuer Rating is based on
DBRS Morningstar's Recovery Rating analysis was based on an enterprise valuation approach, which factored in environmental rehabilitation obligations. Based on the Recovery Rating analysis, DBRS Morningstar confirmed a Recovery Rating on the Second Lien Notes at RR6 and the corresponding instrument rating at CCC (high), two notches below the Issuer Rating. Refer to 'DBRS Morningstar Criteria: Recovery Ratings for Non-Investment-Grade Corporate Issuers' for the full details of this approach.
The Company continues to have significant cash balances and outstanding unpaid receivables associated with its Cuban operations. At the end of the third quarter 2021, the Company reported a cash balance of
DBRS Morningstar notes that the receipt of higher-than-forecast dividends and overdue receivables or the formal approval of the proposed expansion of the Moa JV operations with attractive economic terms could result in a positive rating action. Conversely, a sustained suspension of either the repayment of the outstanding energy receivables or ongoing Moa JV dividends could result in a potential negative rating action.
ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/373262.
Notes:
All figures are in Canadian dollars unless otherwise noted.
The principal methodologies are Rating Companies in the Mining Industry (
The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.
The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.
Generally, the conditions that lead to the assignment of a Negative or Positive trend are resolved within a 12-month period. DBRS Morningstar trends and ratings are under regular surveillance.
For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.
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Ratings
Date Issued Debt Rated Action Rating Trend Recovery Rating Attributesi
US = Lead Analyst based in USA
CA = Lead Analyst based in
EU = Lead Analyst based in EU
E = EU endorsed
U =
Unsolicited Participating With Access
Unsolicited Participating Without Access
Unsolicited Non-participating
01-Dec-21 Issuer Rating Confirmed B Stb CA
01-Dec-21 Second Lien Notes Confirmed CCC (high) Stb RR6 CA
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