Qantas gets credit rating downgraded after huge losses by international arm
September 8, 2012, 12:03 am TWN
SYDNEY -- Australia's Qantas Airways was hit with a credit downgrade Friday after posting huge losses at its international arm, a day after announcing a tie-up with Emirates aimed turning its fortunes around.
Standard & Poor's said in a statement it had cut Qantas from BBB to BBB- with a stable outlook, adding: “The downgrade is driven by our view that Qantas' business risk profile has weakened, because of the structural pressures affecting the airline's international business.”
S&P indicated in June it would put the “Flying Kangaroo” on credit watch “with negative implications” after the airline warned its of a full-year loss for the fiscal year.
The decision came a day after the struggling carrier announced a major global alliance with Emirates that will see its hub for European flights shift to Dubai from Singapore in a bid to stop losses.