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Investing.com -- Moody’s Ratings has downgraded Coronado Global Resources Inc.’s corporate family rating and Coronado Finance Pty Ltd’s backed senior secured notes to Caa2 from Caa1, with ratings remaining under review for further downgrade.
The rating action reflects Moody’s assessment that Coronado faces high default risk within the next 6 to 18 months despite recent liquidity-strengthening efforts. A key concern is a triggered review event under the company’s new ABL facility, creating uncertainty around continued access to this funding source.
As of March 31, 2025, Coronado reported a cash balance of $229 million. The company has secured a $75 million prepayment under a coal supply contract with Stanwell, to be repaid through coal deliveries beginning January 2027. Additionally, Coronado has deferred Stanwell rebate payments from April to December 2025, providing up to $75 million in further liquidity support.
With $75 million already drawn from its ABL facility, Coronado is expected to end the June quarter with approximately $240 million in cash. However, Moody’s projects continued negative free cash flow over the next 12-15 months, particularly in 2026 when rebate relief expires.
The company is pursuing additional liquidity measures, including potential minority asset sales and customer prepayments, though execution remains uncertain amid coal market volatility and operational risks.
Moody’s review will focus on the outcome of the ABL review event, execution of liquidity-enhancing transactions, and operational improvements, particularly regarding the Mammoth underground and Buchanan expansion projects.
The rating agency notes that without a sustained recovery in coal prices or significant cost improvements, cash depletion will likely continue in 2026, potentially resulting in a funding shortfall in the second half of the year.
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