International credit ratings agency Fitch Ratings has announced that it has revised Australia-based miner Fortescue Metals Group Limited's outlook to stable from negative and affirmed its credit rating at BB+.
Fitch stated that the outlook revision reflects the expectation that debt will decrease and the decrease could be accelerated if iron ore prices remain above $110/mt through the current financial year.
According to Fitch, the ratings reflect Fortescue's cost advantages due to its close proximity to key Asian markets. Substantial rail and infrastructure assets assist in its cost advantage. On the other hand, Fortescue has limited business diversification compared with its international peers, currently selling one product, namely iron ore, into the Chinese market.