Rating confirmation for Energa SA by Moody's

On 25 April 2018, Moody's confirmed Energa's Baa1 rating, with stable outlook.

According to the explanatory notes accompanying the statement, the company is expected to continue to achieve EBITDA from its Distribution Business Line of over 70% in the medium term.

The Agency claims that despite an ambitious investment plan, the company's debt ratios should stay within safe limits. Concerning the construction of the Ostrołęka C coal fired power plant, Moody's noted that in addition to Enea's participation as a partner within the industry, other financial investors may get involved in the venture. Furthermore, the Agency expressed the view that in order to achieve a positive return on the investment, it will be necessary for the power plant to receive support from the Power Market. The first auction is to be held in late 2018.

In Moody's assessment, Energa's credit profile is supported by stable revenues, mainly from distribution, which accounted for 80% of Energa Group's EBITDA in 2017. The company also has low operating risk exposure, due to relatively stable and clear regulations.

The rating was not commissioned by Energa SA. The full report is available on the Agency's website.