On Thursday, 16 August rating agency Moody’s upgraded the rating outlook for Holding Slovenske elektrarne (HSE) from stable to positive. The agency expects a further improvement of the credit indicators in the period of 12 to 18 months after the end of 2017 primarily because of the efficient implementation of cost-cutting measures, a moderate capital expenditure programme, a dividend policy which does not envisage payouts to the owner, and the trends in prices of electricity in regional markets.
At the same time, the agency Moody’s expects that the investment activity will keep the financial indicators of the HSE at least at the existing level,
The existing rating Ba2 could be upgraded by a notch under the assumption that the group preserve its financial soundness, measured with the ratio which measures cash flow from operations in comparison with debt, comfortably above 10%. The outlook could meanwhile be downgraded in the case that the group failed to show the ability to maintain the credit indicators at the appropriate level, if it irreversibly violated the commitments from the credit contracts or in the case of a substantial deterioration of liquidity, which the agency does not expect to happen.
Please find more information in the following link: https://www.moodys.com/research/Moodys-changes-outlook-to-positive-on-Holding-Slovenske-elektrarne-doo–PR_387823