Moody’s changes Yorkshire Water to negative

Moody's Investors Service said it affirmed the Baa2 corporate family rating of Yorkshire Water Services Ltd.

The agency also affirmed the Baa1 senior secured and Ba1 subordinated debt ratings of the Ccass A and class B notes issued by Yorkshire Water Services Bradford Finance Ltd., the Baa1 senior secured debt ratings of Yorkshire Water Services Finance Ltd. and the Baa1 senior secured debt ratings of Yorkshire Water Services Odsal Finance Ltd. (all guaranteed by Yorkshire Water).

The outlook was changed to negative from stable.

Moody’s said the action follows the Dec. 13 publication by the Water Services Regulation Authority (Ofwat), the economic regulator for water companies in England and Wales, of its final methodology for the 2019 price review, including guidance on allowed cost of capital for the period from April 2020 to March 2025 (AMP7).

The negative outlook reflects Yorkshire Water's exposure to the likely cut in allowed returns from 2020, as guided by the regulator in its final 2019 price review methodology, the agency explained.

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