Aboitiz Power’s bond issue scores highest credit rating
By Myrna M. Velasco – January 18, 2022, 2:14 PM
from Manila Bulletin
Listed firm Aboitiz Power Corp. has secured the highest credit rating on its slated third tranche bond issue for this year which targets to raise P10 billion worth of proceeds, including allotment for oversubscription.
In a statement, the Philippine Rating Services Corporation (PhilRatings) announced that it issued a credit rating of PRS Aaa to Aboitiz Power, with a “stable otulook” for its bond offer that will have a base issue of P7 billion and an oversubscription of P3 billion.
Aboitiz Power
The pioneer domestic credit rating agency explained that PRS Aaa “is the highest credit rating” that it has been extending to corporate borrowers as reckoned on its long-term issue credit rating scale.
“Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong,” the rating agency expounded.
For the “stable outlook” accorded on Aboitiz Power, PhilRatings stipulated that “the rating is likely to be maintained or to remain unchanged in the next 12 months.”
The factors considered in the assignment of the rating include: the firm’s diversified portfolio with good growth prospects; experienced management team; sustained financial recovery; and sufficient liquidity levels that is supported by strong cash flow generation.
PhilRatings similarly noted that “the power industry is seen to be relatively more stable amidst economic uncertainty and the immediate adverse impact of the COVID-19 pandemic, given that electricity is an essential need.”
The rating agency pointed out it based its assessment on “available information and projections at the time that the rating review was performed.”
PhilRatings indicated that it shall “continuously monitor developments relating to Aboitiz Power and may change the rating and ‘otulook’ at any time, should circumstances warrant a change.”
Aboitiz Power is currently the country’s top power producer with diversified electricity generating technologies leaning on oil, coal, geothermal, hydro and solar resources.
Apart from volume sales at the level of its distribution utilities in Visayas and Mindanao, Aboitiz Power is also a robust player in the competitive retail market of the restructured power sector, currently ranked second in that space, next to Manila Electric Company.
The power firm is currently pacing for further capacity expansion, primarily targeting greenfield renewable energy projects to underpin the rebalancing of its portfolio to a 50:50 ratio of thermal-to-green energy technologies by the turn of the decade.
