Fitch Affirms Poland's Tauron at 'BBB'; Stable Outlook .

By bne IntelliNews July 5, 2011
Fitch Ratings has affirmed Tauron Polska Energia Long-term foreign and local currency Issuer Default Ratings (IDR) at 'BBB' with Stable Outlooks, rating agency said in communique. "The rating reflects Tauron's (Tauron group, comprising Tauron and its subsidiaries) solid market position in the Polish power sector, limited diversification of the fuel mix in generation and prudent financial policy. Fitch believes that thanks to its low financial leverage, Tauron has substantial rating headroom to co-fund its ambitious medium-term capex plan with debt and maintain the current rating," report reads. Fitch notes that at end-2010, Tauron substantially improved its structural subordination issue by raising new debt at group's mother unit and repaying most of the debt at the subsidiary level. At YE10, around 60% of total debt was issued at the holding level (compared to zero at YE09). This improves the position of Tauron S.A.'s creditors as they previously had weaker access to the cash flows of Tauron subsidiaries (where most cash flow is generated) than creditors lending directly to the subsidiaries, especially as 83% of debt was secured on fixed assets at YE09 and the current bond programme of Tauron is unsecured. Furthermore, Fitch expects that all new debt will be raised at the holding level and the remaining debt at the subsidiaries level will be almost fully repaid within two to three years. Progress in operational integration and application of a central financing model (including cash pooling and internal bond programme) reinforces Fitch's view that structural subordination has ceased to be a constraining factor for Tauron's IDR. Tauron posted consolidated net profit of PLN 382.47 mn in Q1/2011 vs. PLN 291.81 mn profit a year earlier. The result came in better than market expectations of a PLN 317 mn profit on the average. Consolidated revenue amounted to PLN 5299.07mn vs. PLN 3794.33mn a year earlier.
Read in IntelliNews Pro
Get IntelliNews Pro

Related Articles

EC refers Poland to court for delay on renewable energy rules.

The European Commission is referring Poland (and Cyprus) to the Court of Justice of the European Union for failing to fully transpose EU's Renewable Energy Directive, according to the ... more

ZEW Economic Sentiment Indicator for Poland surges to 42.9pts in February.

The ZEW-Erste Group Bank Economic Sentiment Indicator for Poland (economic expectations) surged by 22.3pts m/m to 42.9pts in February, according to a report by the Center for European Economic ... more

FinMin: Poland to inject EUR 5.5bn of FX reserves to ECB upon euro-zone entry.

When Poland joins the euro-zone, it will have to transfer EUR 5.47bn of its foreign-currency reserves to the European Central Bank, according to a statement by the ministry of finance. The ... more

Follow Us On

Most Read

  1. Ukraine's birth rate plummets to 300-year low as country’s population collapses
    8 days ago
  2. EU finally boosts defence investment into arms production as Ukraine runs out of ammo
    1 month ago
  3. Fresh evidence suggests that the April 2022 Istanbul peace deal to end the war in Ukraine was stillborn
    8 days ago
  4. Don't mention the "D" word - Ukraine
    5 days ago
  5. Europe unlikely to tackle Russian LNG imports anytime soon
    2 days ago
  1. Russia could pay off its entire external debt tomorrow, in cash
    26 days ago
  2. Speculation swirls of “Men in Blue” in Crocus City Hall terrorist attack linked to FSB
    30 days ago
  3. Albanians campaign on social media to keep bus bridge created in freak accident
    1 year ago
  4. BRICS announce a blockchain-based payment system to create a common currency
    28 days ago
  5. Saudi Arabia to scale back plans for Neom city
    15 days ago

Reports

Dismiss