PrefBlog

On November 26, Standard & Poor’s announced:

that it has reviewed its ratings on the corporate industrial and utility companies that were labeled as “under criteria observation” (UCO) after the publishing of its revised Corporate criteria on Nov. 19. The ratings on seven Canadian corporate entities were placed on CreditWatch with positive implications as a result of this review, meaning that they will likely be raised. At the same time, the ratings on three Canadian corporate entities were placed on CreditWatch with negative implications, meaning that they will likely be lowered.

AltaGas Ltd., proud issuer of ALA.PR.A and ALA.PR.E was put on Watch-Negative.

S&P has now announced:

• Standard & Poor’s published its revised corporate criteria Nov. 19, 2013
• We are affirming our ratings, including our ‘BBB’ long-term corporate credit rating, on AltaGas Ltd.
• We are also removing the ratings from CreditWatch, where we placed them with negative implications Nov. 26, 2013, in conjunction with our revised criteria.
• We assess AltaGas’ business risk profile as “strong” and financial risk profile as “significant” based on the medial volatility table.
• The stable outlook reflects our expectations of improving financial metrics in 2014 and 2015 when major capital projects enter service, and the company maintaining its mix of midstream, unregulated power and regulated utility businesses.

…
We believe the combination of acquisitions in 2013 and the Forrest Kerr project entering service mid-2014 will further diversify the company away from commodity-related cash flows such as fractionation margin and power sales in the Alberta market. We estimate that commodity-related cash flows will decline to less than 15% of consolidated cash flows by 2015.
…
The stable outlook reflects our expectations that financial metrics will improve in 2014 and 2015 as Forrest Kerr enters service, AltaGas’ business mix continues to diversify, and commodity exposure declines to less than 15% of cash flows in two years.

This entry was posted on Wednesday, December 18th, 2013 at 9:09 pm and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.