Fitch: ElectroAndina view positive

Fitch Ratings said it affirmed the BB foreign- and local-currency issuer default ratings of ElectroAndina SA and revised the company's outlook to positive from stable.

The positive outlook incorporates the agency's expectation of continued strengthening in credit fundamentals, as the company is expected to renegotiate existing long-term power purchase agreements, which should improve operating results and further deleverage the company. It also reflects the reduction of fuel availability risk and higher fuel diversification due to the introduction of liquefied natural gas into the system.

Fitch said the ratings reflect ElectroAndina's business position, which benefits from its long-term power purchase agreements with financially strong industrial and mining companies, well-diversified fuel generation mix and sound operating strategy.

The ratings continue to be constrained by ElectroAndina's exposure to the spot market to serve its contracted position during periods of high natural gas supply restrictions from Argentina and the evolution of energy fuel prices, the agency said.

As of March, ElectroAndina's debt-to-EBITDA ratio was 1.7 times, compared with 2.8 times a year earlier.

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