Ratings agency Moody's has upgraded Gold Fields' credit rating to investment grade.
In a recent ratings action announcement, Moody's said that it has raised gold producer Gold Fields’ rating from Ba1 to Baa3. Baa3 is the lowest level of investment grade and indicates moderate credit risk, whereas Ba1 is the first level of non-investment grade.
According to Moody's, the gold producer has successfully reduced its reliance on its South Deep reserves by upping Australian production, hence its change in investment grade rating.
Douglas Rowlings, Moody's Vice President, said in a statement:
"The upgrade reflects Gold Fields' commitment to maintain credit metrics and financial policy appropriate for an investment grade Baa3 rating as it continues growing in Australia, its largest region by production. Gold Fields has continued to strengthen its credit metrics and de-risk its long-term production profile, thereby reducing its reliance on South Deep reserves in South Africa for future cash flow generation."
Last year, more than 47 percent of Gold Fields’ gross profit came from Australia. According to the company, this is expected to increase to more than 50 percent as its Gruyere project commences production in 2019.
Gold Fields, which is listed on the JSE, the New York stock exchange and the Swiss stock exchange, is currently the world’s eighth-largest gold producer by production.