Fitch: U.S. coal outlook stable

Fitch Ratings said the U.S. coal industry will experience a weaker demand than 2008, but it expects resilient cash flows to sustain the industry's stable outlook.

The agency said well-capitalized coal companies have solid liquidity and modest near-term debt maturities, and leverage should remain in a range with scant new borrowing and solid earnings.

"We are seeing more producers scaling back capital spending together with planned production to conserve liquidity," Monica M. Bonar, a Fitch director, said in an agency statement.

"Looking ahead, we expect to see more instances of building cash balances than either debt repayment or share repurchases, and opportunistic merger and acquisition activity, generally with a high equity component."

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