S&P lowers Northumbrian Water view to negative

S&P said it revised the outlook on Northumbrian Water Ltd. and parent holding company, Northumbrian Water Group, to negative from stable.

The agency also said it affirmed the BBB+ rating on both companies and the BBB+ rating on Northumbrian Water's debt.

S&P also said it affirmed the AA rating and stable outlook on the senior secured bonds issued by Bakethin Finance plc and guaranteed by Assured Guaranty Europe plc.

The negative outlook reflects an expectation that both companies may not be able to post an adjusted FFO-to-debt ratio of higher than 9% on a sustainable basis from the start of the next regulatory period.

The agency said it believes the company's will face growing pressure to outperform its total expenditure allowances and increase its earnings through performance-related incentive payments, S&P said.

S&P said it factors in Northumbrian's solid operational track record over the current regulatory period.

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