Areva SA, the French maker of nuclear reactors, had its long-term credit rating cut two levels by Standard & Poor’s, which cited expected weak credit metrics and free cash flow for 2012 as nuclear demand slowed following the atomic accident in Japan in March.
Areva’s long- and short-term ratings were cut to BBB-/A-3 from BBB+/A-2, the ratings company said in a statement today. The outlook is stable.
“We expect credit metrics and free cash flow to remain very weak in 2012, with a substantial recovery only in 2014, two years later than we previously assumed,” the ratings company said.
Areva SA said last week it plans to cut costs by 1 billion euros ($1.31 billion) by 2015, and to sell at least 1.2 billion euros of financial, mining and other assets by the end of 2013 to shore up its finances which have been hurt by construction delays at a plant in Finland, a slowdown in demand for nuclear fuel and services, and writedowns on mines and other assets.