Hrvatska elektroprivreda (HEP) has regained its investment status
ZAGREB, October 6, 2021 – The rating agency Standard & Poor’s (S&P) has increased the credit rating of the Croatian state energy producer Hrvatska elektroprivreda (HEP) from BB + to BBB-, so that it is now the same as the state credit rating.
This is the first time since 2009 that HEP’s credit rating has been returned to the level of investments, it was stated in the announcement on Wednesday.
S&P said in its report that the upgrade reflects HEP’s success in terms of robust credit indicators in changing hydrological conditions and commodity prices.
This is the result of the gradual evolution of HEP towards a market-oriented company with a more flexible cost structure. Compared to what was previously recorded in the rating, HEP shows that it is more capable of managing its exposure to commodity prices more efficiently and powerfully and reducing implicit volatility. Very good experience proves that the company is committed to maintaining financial strength, the report says.
S&P “recognized our ongoing efforts to improve risk management and our overall financial position in the challenging circumstances of the coronavirus pandemic,” said HEP CEO Frane Barbaric.
He reminded that, thanks to good business results in 2020, HEP paid part of its profit, especially HRK 840.6 million, to the state budget in September. The company continued to operate successfully, achieving a consolidated net profit of HRK 1.25 billion in the first half of 2021, which is HRK 291 million more than in the first half of 2020.
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