S&P Global Ratings on Monday lowered its ratings on Exxon Mobil Corp. (XOM) debt, saying the oil giant's cash flow has fallen "well below" expectations the ratings agency had for the company. With "lower oil and natural gas prices, low refining margins and weak chemicals demand anticipated over the next two years, we expect measures to remain weak without a significant change in the company's financial plans," S&P said Monday. The credit rating was lowered one notch to AA from AA+. The negative outlook "reflects the potential for a further downgrade if the company does not take adequate steps to improve cash flows and leverage over the next 12 to 24 months," S&P said. Shares of Exxon have fallen 56% in the past 12 months, compared with declines of 24% and 26% for the S&P 500 index and the Dow Jones Industrial Average . The company's most-active bonds, the 3.095% notes that mature in August 2049, were recently trading at 93.876 cents on the dollar, at a yield spread of 199 basis points over U.S. treasurys and 17 basis points wider on the day. The notes were the second most active investment trade bond of the day, according to Marketaxess, after a Bank of America Corp. (BA) bond.
-Claudia Assis; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
March 16, 2020 13:53 ET (17:53 GMT)
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