Visitors are reflected in the window of the BMW i8 electric car at the Beijing International Automotive Exhibition in Beijing on April 26. (Andy Wong/Associated Press/Andy Wong/Associated Press)
OIL
Exxon loses longtime AAA credit rating

ExxonMobil has lost the gold-plated credit rating it had held since the Great Depression.

On Tuesday, Standard & Poor’s stripped ExxonMobil of its highest AAA measure of creditworthiness, cutting it to AA-plus. It’s a defeat for the energy giant, which sought to retain the rating after S&P placed it on notice in February. Before the downgrade, ExxonMobil shared the distinction with just two other companies: Johnson & Johnson and Microsoft.

“Nothing has changed in terms of the company’s financial philosophy or prudent management of its balance sheet,” Scott Silvestri, a company spokesman, said in an e-mail. “ExxonMobil places a high value on its strong credit position and continues to be focused on creating long-term shareholder value despite near-term market volatility.”

The downgrade is a blow to Rex Tillerson, chairman and chief executive, as he approaches mandatory retirement age next year.

S&P questioned ExxonMobil’s decision to spend $54 billion on stock buybacks since 2012 even as its debt load swelled. The company’s preference for returning cash to shareholders may be hurting its ability to stockpile cash and pay down debt, the rating firm said.

“The company’s debt level has more than doubled in recent years, reflecting high capital spending on major projects in a high commodity price environment and dividends and share repurchases that substantially exceeded internally generated cash flow,” S&P wrote in the note.

ExxonMobil also is facing challenges finding new discoveries to replace the crude it’s pumping from the ground, S&P said. Exxon found only enough new oil last year to replace 67 percent of production.

— Bloomberg News

FOOD INDUSTRY
Chobani offering shares to employees

Chobani says it is giving its employees an ownership stake in the privately held company.

The Greek yogurt maker says the shares being distributed would amount to 10 percent of the company’s future value in the event of a sale or initial public offering. It says each of its 2,000 full-time employees will receive shares based on their role and time spent with the company.

Chobani says chief executive and founder Hamdi Ulukaya is meeting with employees this week to discuss the plan.

“This isn’t a gift. It’s a mutual promise to work together with a shared purpose and responsibility,” Ulukaya wrote in a letter to employees. The plans were first reported by The New York Times.

— Associated Press

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