ABOITIZ Power Corp. (AboitizPower) received the highest issue credit rating for its fourth tranche of fixed-rate retail bonds out of the P30-billion bonds registered in 2017 under the shelf registration program of the Securities and Exchange Commission.
The Aboitiz-led power firm over the weekend said that the Philippine Rating Services Corp. (PRS) gave the company offering bonds up to P9.55 billion a rating of PRS Aaa, meaning the company has a “very strong” capacity to meet its financial obligations.
Also, it was given a stable outlook, which denotes the firm is unlikely to change in the next 12 months.
The bonds, initially worth P5 billion and which can be oversubscribed up to P4.55 billion, are expected to roll out by the second or third quarter of 2020 in one to three series with tenors ranging from two, five and seven years.
AboitizPower earlier told the stock exchange that it plans to use the proceeds from the bonds to reimburse equity infusions and fund succeeding infusions into AA Thermal, Inc., as well as to invest in Therma Power, Inc. for the construction of two units of the 668-megawatt supercritical coal-fired power plant of GNPower Dinginin Ltd. Co.
The energy company engaged BDO Capital & Investment Corp. and First Metro Investment Corp. as joint issue managers, as well as joint lead underwriters, along with China Bank Capital Corp. It also tapped the BDO Unibank, Inc. Trust & Investments Group as its trustee.
The company issued the first tranche of the retail bonds worth P3 billion on July 3, 2017. The second tranche was out on Oct. 25, 2018, amounting to P10.2 billion, and the third, which is worth P7.25 billion, on Oct. 14, 2019.
PhilRatings also maintained the PRS Aaa credit rating and a stable outlook for the company’s outstanding P30.45-billion bonds.
Ratings by the local debt watcher are based on available information and projections at the time that the rating review was performed.
In 2019, AboitizPower reported a 21% drop in net income to P20.2 billion from P25.4 billion in 2018, brought down by the decline in operating revenues and an increase in operating and interest expenses.
It recorded an attributable net sellable capacity of 3,455 megawatts (MW) in the year with a plan to add 935.2 MW. The power company aims to have 4,000 MW attributable net sellable capacity this year.
This year, over half of the P73-billion capital expenditures of its parent Aboitiz Equity Ventures, Inc., or P41 billion was allotted to AboitizPower. — Adam J. Ang
