EXXARO RESOURCES LIMITED - EXX - Credit Rating Action by Standard and Poor's following the South African Sovereign and Eskom downgrades

EXX - Credit Rating Action by Standard and Poor's following the South African Sovereign and Eskom downgrades

EXXARO RESOURCES LIMITED
Incorporated in the Republic of South Africa
(Registration Number: 2000/011076/06)
JSE share code: EXX
ISIN code: ZAE000084992
ADR code: EXXAY
Bond code: EXX01
ISIN code: ZAG000115957
Bond code: EXX02
ISIN code: ZAG000115965
Bond Code: EXX03
ISIN Code: ZAG000115973
(Exxaro)

EXXARO RESOURCES LIMITED: CREDIT RATING ACTION BY STANDARD & POOR’S RATINGS
SERVICES FOLLOWING THE SOUTH AFRICAN SOVEREIGN AND ESKOM DOWNGRADES

Notice is hereby given in terms of the Debt Listings Requirements of the JSE Limited that Standard
and Poor’s (S&P) has on 10 April 2017 lowered the long-term and South African national scale rating
on Exxaro but affirmed its short-term national scale rating following similar action on Eskom Holdings
SOC Limited (Eskom), which was downgraded on 6 April 2017.

Following downgrade of the South African Sovereign, Eskom was downgraded to ‘B+’ from ‘BB-‘ and
to ‘zaBB-‘ from ‘zaBB+’.

S&P Global Ratings have, as a result, taken the following rating actions on Exxaro: to lower its long-
term South African national scale rating to ‘zaBB-’ from ‘zaBB+’ and affirmed its short-term national
scale ratings at ‘zaB’.

S&P have agreed that “Exxaro enjoys a broadly stable balance sheet despite increasing capital
expenditures (capex), as well as the company’s ability to maintain adequate liquidity.” Despite this
positive outlook, it is the decided opinion of S&P that the strengths are offset by the vulnerabilities of
Exxaro’s cash flows to Eskom credit quality, as well as, concentrated customer profile (see "South
African Utility ESKOM Holdings SOC Rating Lowered To 'B+' Following Sovereign Downgrade;
Outlook Negative", published April 6, 2017, on RatingsDirect).

The Exxaro unsecured bonds on which this ratings downgrade has bearing, represents less than 15%
of the current Exxaro loan facilities. Despite the ratings downgrade Exxaro continues to have a strong
balance sheet with low gearing levels and sufficient sources of short term and long term liquidity.

For further information see "Coal Miner Exxaro Resources LT South Africa National Scale Ratings
Lowered to ‘zaBB-‘ following similar action on Eskom", published April 10, 2017, on RatingsDirect.

CH WESSELS
GROUP COMPANY SECRETARY

11 April 2017

Sponsor
Absa Bank Limited, acting through its corporate and investment bank division

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