Standard & Poor’s has announced:
- •We are revising our outlook to negative from stable on Calgary, Alta.-based ATCO Ltd. and its subsidiaries Canadian Utilities Ltd (CU Ltd.) and CU Inc.
- •We are also affirming our ‘A’ long-term corporate credit rating on ATCO and its subsidiaries.
- •The negative outlook reflects our view that ATCO’s planned capital program could put pressure on the company’s financial metrics, affecting our positive comparable rating analysis modifier on the company.
…
“We base the outlook revision on our view that the company’s forecast financial metrics in the context of a more difficult Alberta operating environment, as well as its aggressive capital program, weaken the rationale for our positive comparable rating modifier on the company,” said Standard & Poor’s credit analyst Stephen Goltz. “Recent regulatory decisions also put additional pressure on the company’s revenue and cash flow,” Mr. Goltz added.
…
We expect the company to invest heavily in the next few years, similar to the past three. Furthermore, although supported by long-term contracts, not all of the future spending will be regulated. Our forecast expects development of the water infrastructure and liquids storage project in Alberta, a natural gas pipeline and cogeneration power plant in Mexico, and the Fort McMurray West Transmission Project.
The outcome of the Alberta Utilities Commission’s latest decisions also affect ATCO’s revenue and recovery of prudent capital spending contributing additional pressure on cash flow stability.
The negative outlook reflects our view that the planned capital program that is forecast to occur in the context of a weaker Alberta operating environment could put pressure on financial metrics, which would cause us to remove our positive [comparable rating analysis] modifier on the company.
Affected issues are CU Inc.’s CIU.PR.A and CIU.PR.C, and Canadian Utilities’ CU.PR.C, CU.PR.D, CU.PR.E, CU.PR.F and CU.PR.G. All are tracked by HIMIPref™.
This entry was posted on Tuesday, July 7th, 2015 at 9:48 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.
CU, CIU Outlook Negative: S&P
Standard & Poor’s has announced:
Affected issues are CU Inc.’s CIU.PR.A and CIU.PR.C, and Canadian Utilities’ CU.PR.C, CU.PR.D, CU.PR.E, CU.PR.F and CU.PR.G. All are tracked by HIMIPref™.
This entry was posted on Tuesday, July 7th, 2015 at 9:48 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.