Winter Park, Florida 25/01/2016 - Horsehead Holding Corp has temporarily idled its Mooresboro, North Carolina, zinc production facility.
The decision is the result of many factors, including a depressed zinc price and the company’s current liquidity situation. A small workforce will be retained to manage the facility during this period, Horsehead said in a short statement.
Last week, Standard & Poor's Ratings Services lowered the company's corporate credit rating to 'SD' from 'CCC', noting that Horsehead elected to exercise the 30-day grace period to pay an approximately $1.9 million interest payment.
"Given our view of the company's debt level as unsustainable, and ongoing restructuring discussions, we do not expect a payment to be made within the grace period. In accordance with our criteria, we are lowering the corporate credit rating to 'SD'," said Standard & Poor's credit analyst Ryan Gilmore.
Horsehead opened Mooresboro in the first quarter of 2014. The facility has the ability to produce 155,000 short tons per year of Prime Western (PW), Special High Grade (SHG) and Continuous Galvanizing Grade (CGG) zinc products.
Three-month zinc on the London Metal Exchange is currently trading at $1,521 per tonne, which is just above the seven-year low of $1,474 hit in December.