Fitch estimates that Arch’s free cash flow for 2012 will be negative, in the range of -$150 million to -$370 million and also points to high inventories and high debt:
The credit ratings also reflect oversupply in the domestic steam coal market which is expected to result in substantially lower earnings through at least 2013. Weak earnings and high debt levels post the acquisition of International Coal Group in 2011 will result in high leverage metrics over the period offset by strong liquidity.
Shares are down about -7.3% today, at $8.55 after posting a new 52-week low of $8.42 earlier. The previous low of $9.02 was set yesterday.
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