Fitch rates Electrica Guacolda A, upgrades bonds

Fitch Ratings said it assigned Electrica Guacolda SA a national scale rating of A and upgraded the national scale rating to AA(chl) from A+(chl) on the series A bond issue.

The outlook is stable.

The upgrade reflects the new credit conditions of the local bond, Fitch said.

The ratings reflect Guacolda's solid business position, sound operating and commercial strategies, long-term supply contracts, growing electricity demand and energy prices in the region and debt-service coverage ratios, the agency said.

The rating also incorporates potential weaknesses, including exposure to fuel prices, construction risks and credit pressures due to added debt, Fitch said.

For the first quarter, Guacolda reported a debt-to-EBITDA ratio of 3.9 times versus 4.1 times for the first quarter of 2006, the agency said.

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