S&P affirms AzerEnergy company’s rating at BB

S&P affirms AzerEnergy company’s rating at BB

BAKU, Azerbaijan, Feb. 27

By Nargiz Ismayilova – Trend:

S&P Global Ratings has affirmed AzerEnergy company’s rating at BB, Trend reports referring to S&P.

“We expect AzerEnergy will continue to benefit from ongoing and extraordinary state support,” the message said. “We believe there is an extremely high likelihood that Azerbaijan would provide timely and sufficient extraordinary state support to AzerEnergy in the event of financial distress. Therefore, we include four notches of uplift in our 'BB' rating on the company to reflect this. We believe the government will continue to focus only on supporting AzerEnergy's operations and investments.”

“For social and political reasons, the government is unlikely to lift regulated tariffs to a level that would be sufficient to cover the full sum of AzerEnergy's operating expenditure, large capital expenditure (capex) needs, and debt service,” the message said.

“We understand that Azerbaijan's long-term road map for the energy sector proposes privatizing certain energy assets, even though we don't expect AzerEnergy will be privatized or significantly restructured in the next several years,” the message said. Therefore, we do not equalize our ratings on AzerEnergy with those on Azerbaijan (BB+/Stable/B). Rather, our long-term rating on AzerEnergy remains one notch lower than that on the sovereign.”

“Despite sizeable capex needs, we expect the company will avoid incurring any third-party debt without government guarantees,” the message said.

“Following a massive blackout in 2018 caused by an accident at Azerenergy's Mingachevir thermal power plant, the government reviewed the country's energy system and approved a rehabilitation plan,” the message said. “As a result, AzerEnergy's investment program increased materially and we forecast capex exceeding 1 billion manat (about $0.6 billion) in 2019-2020.”

“We expect the state will continue to co-finance AzerEnergy's capex via equity or direct state loans, and the company will avoid any third-party debt not guaranteed by the government,” the message said. “We also expect the Ministry of Finance will cover any liquidity shortages at the company if needed, including via co-funding capex or supporting debt service.”

“Thus, we continue to assess AzerEnergy's stand-alone credit profile at 'b-', taking into account ongoing state support,” the message said. “We also consider high risks related to the company's capital structure, since the debt portfolio is predominantly denominated in foreign currencies and the company remains exposed to the risk of exchange rate fluctuations. There are no substantial cash flows in foreign currencies to mitigate this risk.”

“If we were to lower our long-term rating on Azerbaijan by one notch, we would likely take a similar rating action on AzerEnergy, all else remaining equal,” the message said.

Number of patients contracted COVID-19 in Kazakhstan hits 584
Number of patients contracted COVID-19 in Kazakhstan hits 584
Kazakhstan reports 6th Covid-19 death
Kazakhstan reports 6th Covid-19 death
More coronavirus cases registered in Kazakhstan, total at 569 (UPDATE)
More coronavirus cases registered in Kazakhstan, total at 569 (UPDATE)
Loading Bars
BMW sales plunge in first quarter as coronavirus takes toll
Iran reveals hydrocarbons to be put up on its Energy Exchange
UK new car sales plunge 40% in March as coronavirus hits
Renewables face three main challenges from coronavirus crisis
Singapore unveils $3.5 billion in economic spending to combat coronavirus
How will lower oil prices impact natural gas markets?
Both Saudis and Russia to continue to pursue strategy of maximizing market share
Iran announces exports from its Maragheh county
Number of coronavirus cases in Uzbekistan continues to grow
Turkey's export of steel decreases
Petrofac reducing overhead and project support costs in response to COVID-19
Iran should provide more support to families with no income - MP
Possible OPEC+ deal won’t add supply shock to demand shock
Iran to increase pension wages for certain layers of retired citizens
Iran says its oil production 'stable, uninterrupted'
Turkey's cement export in 1Q2020 grows
European stock index futures jump as coronavirus death toll slows
Turkey drops export of ready-made clothing to world markets
Turkey's foreign trade turnover increases
Turkey increases export of grain, legumes to world markets
Gold price up in Azerbaijan on April 6
Total coronavirus cases increase to 174 in Georgia
Iranian currency rates for April 6
Turkey's furniniture, wood exports increase
Iran unveils high-precision electro-optical screening system
Azerbaijani currency rates for April 6
Iran's production of fans soars amid coronavirus spread
Armenia violates ceasefire with Azerbaijan 24 times in last past 24 hours
Iran makes its own version of Favipiravir drug to cure coronavirus patients
Iran's gold price increases despite closure of stores
Russian ambassador to Azerbaijan: Together we will go through current difficult stage
Tiger in New York zoo tests positive for COVID-19
Minister: Slovenia, Azerbaijan should unleash untapped opportunities in services, investments
Virus-hit Carnival cruise ship docks in Australia as country's death toll hits 39
Argentina plans payment freeze on up to $10 billion in local-law dollar debt
Number of patients contracted COVID-19 in Kazakhstan hits 584
China sees rises in new coronavirus cases, asymptomatic patients
U.S. death toll of COVID-19 tops 1,200 in last 24 hours, says Johns Hopkins
Japan PM Abe to declare state of emergency as early as Tuesday
Iran's coronavirus cases nudge 60,000 as slowdown continues
Egypt confirms 103 new COVID-19 cases, 1,173 in total
6.1-magnitude quake hits eastern Indonesia, no tsunami alert issued
Number of COVID-2019 cases across globe up by 82,000 in past day - WHO
Spain's coronavirus death toll rises by 674 but pace keeps slowing
Indians light lamps to heed Modi's call for coronavirus comradeship
UK PM Johnson admitted to hospital with persistent coronavirus symptoms
Kuwait to resume imports of foodstuff from Iran
Canada's Ontario reports 4,038 COVID-19 cases, with 119 deaths
Singapore reports 120 new COVID-19 cases
Azerbaijani stars join #Evdəqal (stay home) campaign: Video project by Trend news agency
Georgian textile companies produce significant number of face masks
Production at Iran’s South Pars gas field up
300 medical workers infected with coronavirus in Iran
Wheat harvest starting in Iran
Iran's Sefid-Dasht Company increases production
Georgia receives foodstuff, medical supplies via Batumi port
Iran discloses revenues from kiwi exports
Iran’s Arak Heavy Water Reactor being built in new design
Iran sees growth in agricultural sector
Two patients die from COVID-19 in Azerbaijan
UK coronavirus death toll rises by 621 to 4,934
COVID-19 death toll reaches 360, total cases climb to 8,536 in Africa: Africa CDC
Morocco grants pardon for 5,654 prisoners
Turkic Council Member States show profound spirit of collaboration in fight against COVID-19 pandemic
Swiss coronavirus death toll rises by 19 to 559, cases top 21,000
Senegal's confirmed COVID-19 cases rise to 222, 82 cured
Azerbaijan discloses tax incentives for business entities
Georgia reports 2nd death from coronavirus
NAM member-states do not recognize so-called "elections” in Nagorno-Karabakh
Almost 2,500 more people infected with coronavirus in Iran
Unemployment rate down in Iran
Central Bank of Iran reports increase in exchange checks
Serviceman killed in armed incident in southeastern Iran
More positive coronavirus cases confirmed in Azerbaijan
Iran announces number of generators to be produced on basis of OHVG
Iran to increase output of some products
Rouhani: Low-risk economic activities to start in Iran in several days
Oil products to go on sale in Iran
Gasoline consumption decreases in Iran
Production of Pars Petrochemical Company increases in Iran
Number of oil wells drilled in Iran revealed
Spain's coronavirus death toll rises by 674 to 12,418
Azerbaijan discloses budgetary funds to fight against coronavirus
COVID-19 cases exceed 8,000 in Israel, death toll at 46
Kazakhstan reports 6th Covid-19 death
More coronavirus cases registered in Kazakhstan, total at 569 (UPDATE)
Azerbaijani government to guarantee 60 percent of new loans
Azerbaijan creating new mechanism in construction sector
Banks, insurance companies exempted from making payments in Azerbaijan in April
Import of several products to Azerbaijan to be exempted from customs duties
Azerbaijan to increase limit of electricity provided at preferential tariffs
Azerbaijan prepares video instructions on rules of using sms-permission system
Baku Media Center prepares another video footage to support fight against coronavirus
Azerbaijani State Migration Service presents another video footage related to coronavirus
Russian Expert: New deal of OPEC+ to increase oil price, to be beneficial for Azerbaijan
Iran's gas exports increase
State Border Service: Armenian armed forces fire on vehicles in Azerbaijan’s Gazakh district
Iran's trade turnover with Eurasian Economic Union announced
Greece quarantines second camp after coronavirus case confirmed
India's COVID-19 death toll rises to 77 as total cases reach 3,374
All news