Reuters: Financial Services and Real Estate: TEXT-S&P affirms UAE-based DEWA rtgs; Outlook to positive

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TEXT-S&P affirms UAE-based DEWA rtgs; Outlook to positive Mar 29th 2012, 10:05 Thu Mar 29, 2012 6:05am EDT (The following statement was released by the rating agency) March 29 - Overview -- We believe that Dubai Electricity and Water Authority's (DEWA) capital expenditure will be lower and more flexible than we previously expected, due to the finalization of key projects and lower-than-anticipated growth in electricity demand. -- DEWA's financial performance in 2011 is expected to have been healthy, supported by a 15% increase in tariffs and the ability to pass rising fuel costs through to consumers. -- As a result, we believe DEWA will likely be able to generate positive discretionary cash flow, supporting effective debt reduction over the medium term. -- We are affirming our 'BBB-' long-term corporate credit rating on DEWA and at the same time revising the outlook to positive from stable. -- The positive outlook reflects our view that DEWA's stand-alone credit profile could strengthen, mainly resulting from maintenance of a better-than-expected financial risk profile, and lead to a one-notch upgrade of ratings. Rating Action On March 29, 2012, Standard & Poor's Rating Services affirmed its 'BBB-' long-term corporate credit rating on Dubai-based vertically integrated utility Dubai Electricity and Water Authority (DEWA). At the same time, we revised the outlook on the company to positive from stable. Link this Share this Digg this Email Reprints

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