S&P changes Kiowa Power view

S&P said it revised its outlook on Kiowa Power Partners LLC's $281 million senior secured bonds due 2021 to positive from stable.

At the same time, the agency affirmed its BBB+ rating on the bonds.

S&P said the revision reflects a fairly stable operating profile, an ongoing pattern of increasing debt service cushion and a view that management will maintain consistently strong liquidity relative to total debt.

The agency said the positive outlook reflects an expectation of further improvements in debt service coverage as the bonds approach maturity, with a debt service coverage ratio of 1.64x in 2018 increasing to above 2x in 2020.

“We also believe that the project's contractual structure will continue to insulate it from shocks to both revenues and expenses,” S&P said in a news release.

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