NEW YORK, April 11 (IFR) - Fitch Ratings cut aluminum maker
Alcoa to "junk" status on Friday, citing expectations that the
company's leverage will remain above that required for an
The ratings agency cut the issuer to BB+ from BBB- with a
Alcoa is rated BBB- by S&P, the lowest investment-grade
rating, and Ba1 by Moody's.
Fitch said the company's profitability has been hampered by
global oversupply in aluminum.
"The downgrade reflects Fitch's view that financial leverage
will remain above 2.5x on a total debt/EBITDA level and above
3.5x on an FFO adjusted level through 2014," Fitch said.
"Significant pension contributions will keep FFO adjusted
leverage above 3.5 through 2015. The company has generated free
cash flow after capital expenditures and dividends to
shareholders since 2010 despite weak aluminum prices."
(Reporting by Natalie Harrison; Editing by Mariana Santibanez)