Aboitiz Power Corporation has received the highest credit rating of PRS Aaa with a Stable Outlook from the Philippine Rating Services Corporation (PhilRatings) for its upcoming bond offering, based on a regulatory disclosure filed on April 29.
The rating covers the company’s planned issuance of Php 20 billion in fixed-rate retail bonds, with an oversubscription option of up to Php 10 billion. This offering marks the first tranche of AboitizPower’s newly approved three-year shelf registration program, which allows for the issuance of up to Php 100 billion in bonds.
According to PhilRatings, a PRS Aaa rating indicates that the obligations are of the highest quality with minimal credit risk, reflecting an extremely strong capacity of the issuer to meet its financial commitments. The Stable Outlook means that the rating is expected to remain unchanged over the next 12 months.
The rating was based on several key factors, including AboitizPower’s diversified generation and distribution portfolio, strong liquidity position, sound capital structure, and a management team with extensive experience in the energy sector.
PhilRatings also reaffirmed the PRS Aaa rating with a Stable Outlook on AboitizPower’s Php 43.3 billion in existing bonds previously issued between 2017 and 2022.
AboitizPower operates across various power technologies including hydro, geothermal, solar, coal, and oil. It reportedly holds the largest installed renewable energy capacity under market control in the country. In power distribution, the company maintains stakes in Visayan Electric and Davao Light, the second and third largest utilities nationwide in terms of customer base and energy sales.
As of December 2024, AboitizPower accounted for 29.3% of the retail electricity supply (RES) market, with a contracted capacity of 1,181.98 megawatts. The company aims to grow its net attributable renewable energy capacity to 4,600 megawatts, of which 3,700 megawatts are targeted to come from new projects.
In 2024, AboitizPower posted Php 46.1 billion in net cash flows from operating activities, down from Php 50.3 billion in 2023. Despite the year-on-year decline, the company maintained solid financial ratios, including a current ratio of 1.6x, an EBITDA interest coverage ratio of 5.0x, and a debt service coverage ratio of 1.3x.
The company also maintained a healthy capital structure, with a debt-to-equity ratio of 1.1x and a solvency ratio of 1.7x in 2024. AboitizPower expects to gradually reduce its debt load over time, primarily through earnings retention and reinvestment, thereby improving its leverage position.
Follow Power Philippines on Facebook and LinkedIn for more updates.
There are no comments
Add yours