Bloomberg - Fortescue Metals Group Ltd

Orlando Gemes

Bloomberg - Fortescue Metals Group Ltd. is taking advantage of rising iron-ore prices to cut Australia's largest junk-debt burden, spurring its best bond gain this year. Fortescue, forced to negotiate $5 billion in new loans last year when commodity prices tumbled, this month said it will repay A$140 million ($131 million) of its most expensive debt to reduce interest costs. The Perth-based miner's total debt is 2.4 times equity, higher than 25 of the 30 other companies in the Merrill index for which data is available. I The iron-ore price has stayed high enough for long enough and now Fortescue is delivering on volume growth, said Ben Byrne, a credit sector specialist at Citigroup Inc. in Sydney. The result is the company is generating very solid cash flows at the same time that capital expenditure is declining.


Orlando Gemes

Orlando joined Hermes Fund Managers in 2010, and is responsible for structured credit solutions.

debt iron

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Medium screen shot 2016 01 12 at 2.25.34 pm

James Marlay

iron ore producers having a great time at the moment and prices remain well above most analyst forecasts. Chinese PMI looking strong so could support the IO price longer term.

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