Qantas Airways Limited
(ASX:QAN) has affirmed its strong financial position following Moody's Investors Service's decision to cut its long-term credit rating from Baa2 to Baa3.
After the market closed yesterday Qantas said its rating remains investment-grade amid headwinds such as high fuel prices and travel market uncertainty, due to Europe’s sovereign debt crisis.
The airline also says it has a cash balance of more than $3 billion and remains in a strong financial position.
Despite the assurance, The Australian has speculated Qantas will now launch a review of discretionary spending and is likely to trim capacity.
Qantas was last downgraded by Moody’s in early 2009 and last put on review for a downgrade in October 2011.
In the 2011 financial year Qantas reported a net profit of $249 million.
