Fitch lowers SSE view to negative

Fitch Ratings said it revised SSE plc's outlook to negative from stable and affirmed its long-term issuer default rating at BBB+.

Fitch also said it affirmed SSE's senior unsecured debt rating at BBB+, short-term issuer default rating and short-term senior unsecured rating for the company's commercial-paper program at F2 and its subordinated notes and outstanding hybrid issuances at BBB-.

The outlook revision reflects a view that most business segments of SSE are under pressure, the agency said.

Fitch said it forecasts adjusted net leverage for financial year March 2019 at 5.2x, temporarily higher than the downgrade sensitivity of 4.5x due to unfavorable market conditions and a freeze on U.K. capacity market payments.

The ratings are based on an assumption that leverage will return to the levels commensurate with the current rating through active balance sheet management and a rebase of the dividend, the agency said.

The ratings are supported by significant regulated cash flows and growing income from renewable generation in the United Kingdom, Fitch said.

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