'Significant uncertainty' over G Steel's liquidity: Moody's
Moody’s Investors Service has given a bleak outlook for Thailand’s second-largest hot rolled coil producer, G Steel Public Co, as it downgrades the company’s credit ratings due to “significant uncertainty over G Steel’s current liquidity position.”
Based on end-December 2008 financial statements, G Steel’s external auditors have raised several concerns, including the quality and quantity of allowances provided on the company’s outstanding trade receivables, says Moody’s in a statement seen by Steel Business Briefing.
G Steel had trade receivables of THB 3,957m ($110m) outstanding as at 31 December. Of this, THB 3,582m pertained to three unrelated parties, had incomplete documentation for sales authorisation, lacked evidence of delivery of goods, and did not have signatures acknowledging receipt of goods. The uncertainty of collection of these trade receivables will exacerbate the company’s already poor liquidity and its access to bank funding will be constrained, says Kathleen Lee, a vp with Moody’s.
Moody’s also raised concerns over future losses at G Steel in view of committed higher prices for its consigned or purchases of raw materials versus current market prices. It notes G Steel’s operating environment remains challenging over the medium term and its weak liquidity position. G Steel's near-term financing risk is evident from its scheduled semi-annual loan maturities in 2009, which do not have the support of available committed facilities.
Moody’s downgraded the corporate family rating and senior unsecured ratings of G Steel to Caa3 from Caa1. G Steel officials were unavailable for comments.
News from SBB
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News from Key to Metal March 2009
1. New Developments Completed in March
Brazilian materials have again been upgraded with specifications for various steel tubes, sheets and other flat products, carbon steel bars and forgings, and feroalloys.
US AMS aerospace materials have been updated with 50 new specifications for corrosion-resistant alloys.
Heat treatment diagrams for over 1500 European materials have been added.
New articles have been added for you in the KEY to METALS • Steel Knowledge Base:
- Rail Steel, and
- Marine Stainless Steel Applications.
2. Developments Planned for Aprile
South African (SANS) specifications will be added to the Database for the first time, starting with various steel castings and cast irons, tubes and pipes, structural steel, fasteners, and more.
Brazilian materials will be upgraded again with additional ferroalloys, low alloy steels, microalloyed carbon steels, coated steels, cold-rolled products and more.
AMS aerospace will be updated with another 60 new specifications for aircraft quality products, low alloy steels, castings, and corrosion-resistant alloys.
Cross-reference tables will be updated according to the guidelines from the newest UNS 2008 Edition.
And, as usual, two new FREE articles will be added for you to the KEY to METALS • Steel Knowledge Base.
3. Marine Stainless Steel Applications
Marine applications are very demanding. Stainless steel is the ideal material for marine applications due to the fact that it resists rust better than other materials such as brass, bronze, or galvanized steel. By now it is common knowledge that stainless steels ranging from AISI 316 up to 6Mo and superduplex do not always resist seawater.
Crevice corrosion and pitting may develop sooner or later. For example, a 25Cr07Ni super duplex tubular heat exchanger in a marine vessel showed crevice corrosion within 6 months of service. In natural seawater a biofilm will develop on the metal surface and it will always promote the corrosivity of the water.
Microbiological induced corrosion often occurs in seawater, and galvanic corrosion is also a major problem at sea.
Materials selection in marine environment is quickly gaining interest because of the worldwide trend to concentrate major industrial facilities around sea ports in order to save transport cost and increase cooling capacity.
To read more on this topic, visit
steel.keytometals.com/default.aspx?ID=Articles
and select article "Marine Stainless Steel Applications".
Brazilian materials have again been upgraded with specifications for various steel tubes, sheets and other flat products, carbon steel bars and forgings, and feroalloys.
US AMS aerospace materials have been updated with 50 new specifications for corrosion-resistant alloys.
Heat treatment diagrams for over 1500 European materials have been added.
New articles have been added for you in the KEY to METALS • Steel Knowledge Base:
- Rail Steel, and
- Marine Stainless Steel Applications.
2. Developments Planned for Aprile
South African (SANS) specifications will be added to the Database for the first time, starting with various steel castings and cast irons, tubes and pipes, structural steel, fasteners, and more.
Brazilian materials will be upgraded again with additional ferroalloys, low alloy steels, microalloyed carbon steels, coated steels, cold-rolled products and more.
AMS aerospace will be updated with another 60 new specifications for aircraft quality products, low alloy steels, castings, and corrosion-resistant alloys.
Cross-reference tables will be updated according to the guidelines from the newest UNS 2008 Edition.
And, as usual, two new FREE articles will be added for you to the KEY to METALS • Steel Knowledge Base.
3. Marine Stainless Steel Applications
Marine applications are very demanding. Stainless steel is the ideal material for marine applications due to the fact that it resists rust better than other materials such as brass, bronze, or galvanized steel. By now it is common knowledge that stainless steels ranging from AISI 316 up to 6Mo and superduplex do not always resist seawater.
Crevice corrosion and pitting may develop sooner or later. For example, a 25Cr07Ni super duplex tubular heat exchanger in a marine vessel showed crevice corrosion within 6 months of service. In natural seawater a biofilm will develop on the metal surface and it will always promote the corrosivity of the water.
Microbiological induced corrosion often occurs in seawater, and galvanic corrosion is also a major problem at sea.
Materials selection in marine environment is quickly gaining interest because of the worldwide trend to concentrate major industrial facilities around sea ports in order to save transport cost and increase cooling capacity.
To read more on this topic, visit
steel.keytometals.com/default.aspx?ID=Articles
and select article "Marine Stainless Steel Applications".
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