Fitch alters EGE Haina view to stable

Fitch Ratings said it affirmed the foreign- and local-currency long-term issuer default ratings of BB- to Empresa Generadora de Electricidad Haina, SA and revised the outlook to stable from negative. Fitch also affirmed EGE Haina's $300 million of senior unsecured notes at BB-.

“The stable outlook reflects Fitch's revision of the outlook on the Dominican Republic's sovereign rating. Haina's credit quality is linked to the sovereign rating given the dependency of state-owned distribution companies from government transfers given the high risk of the Dominican Republic electricity sector, which has high energy losses, low level of collections and important subsidies. The ratings also reflect the company's contracted revenue and lower exposure to the spot market, the size and diversification of its generation asset base and the appropriate leverage,” the agency said in a press release.

However, Fitch warned that inflationary pressure on fuel prices could further stress the management of working capital.

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