Fitch turns Avangrid outlook to negative

Fitch Ratings said it changed Avangrid Inc.’s outlook to negative from stable and affirmed its BBB+ issuer default rating.

“Avangrid's outlook has been revised to negative due to increased leverage from debt-funded investment in offshore wind, the New England Clean Energy Connect (Necec) transmission project and the PNM Resources (Pnmr) acquisition. Cash flows from the networks and renewables businesses are also expected to be weaker. Fitch expects FFO leverage in 2021-2022 to exceed 6.5x, which is weaker than previous expectations. Fitch expects leverage will return to around 5x in 2023,” Moody’s said in a press release.

Concurrently, the agency affirmed the long-term IDRs of Avangrid's following utility subsidiaries: the Berkshire Gas Co at A-, Central Maine Power Co. at BBB+, Connecticut Natural Gas Corp. at A-, New York State Electric & Gas Corp. at BBB+, Rochester Gas and Electric Corp. at BBB+, the Southern Connecticut Gas Co. at A- and the United Illuminating Co. at A-.

The outlook for all rated subsidiaries is stable.

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