Moody's could cut Energen, Alabama Gas

Moody's Investors Service said it placed the ratings for Energen Corp. and Alabama Gas Corp. on review for downgrade after the company reported its fourth quarter operating and financial results.

"The review for downgrade for Energen reflects the company's increasing leverage profile and decline in operating efficiency," Moody's vice president Stuart Miller said in a news release.

"Historically, Energen's modest scale has been offset by the stable earnings from its utility and very conservative consolidated leverage metrics. The outspending of cash flow in 2012 raised leverage to levels that no longer support a Baa3 senior unsecured debt rating. Moody's believes the increasing leverage at Energen reflects a more aggressive financial policy, that if continued, could also impact the credit risk of Alagasco."

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