By NZPA
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Thursday 25th July 2002 |
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Moody's said it was reviewing Tranz Rail's Baa3/prime 3 ratings after the company announced its annual forecasts for 2002 and 2003.
The forecasts anticipate a drop in revenue and increase in operating costs compared with Moody's expectations, resulting in substantially lower earnings, the ratings agency said.
Tranz Rail has also announced a series of asset write-downs which total between $148 million and $170 million.
"The review will focus on the company's ability to substantially meet the forecast improvement in operating performance in the medium term," Moody's said in a statement.
In addition Moody's will consider the implications of the recent announcements on Tranz Rail's financial flexibility.
Fellow ratings agency Standard and Poor's yesterday placed Tranz Rail on creditwatch with negative implications saying that despite extensive restructuring in the past 12-18 months, the company been unable to reach target cost savings or control revenue losses.
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