S&P: Endesa Chile on positive watch

Standard & Poor's said it placed the BBB- ratings on Empresa Nacional de Electricidad SA (Endesa Chile) on CreditWatch with positive implications, reflecting a potential upgrade, due to the company's continuing improvement of its debt service coverage ratios and financial flexibility.

The agency added that this improvement mainly results from its growing cash flow generation, stable debt levels and access to unused committed bank facilities for about $550 million.

Endesa Chile has benefited from a significant increase in cash flow generation in its core Chilean power generation market, S&P said, adding that this increase is mainly due to the relatively high electricity prices there and good water availability in the Central Interconnected System, the largest Chilean electric system.

The agency added that the BBB- ratings on Endesa Chile reflect its satisfactory business risk profile and intermediate financial risk profile while the company benefits from the relatively strong credit risk profile of its Chilean power generation assets, partly offset by investments in power generation in weaker economies such as Argentina, Brazil, Colombia and Peru, which provide some diversity but expose the company to greater economic and financial volatility.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.