Fitch lowers Energo-Pro view to negative

Fitch Ratings said it revised Energo-Pro AS's outlook to negative from stable and affirmed its long-term issuer default rating at BB.

The negative outlook reflects an expectation that leverage will remain elevated until 2020 due to delay in guarantee release and increased distribution to shareholder from 2018 to 2019, Fitch said.

The agency said it expects leverage to be higher than 5x in 2018 before gradually decreasing to about 4.5x in 2020.

The ratings reflect the company's healthy profitability and geographic diversification, as well as a supportive regulatory regime in utilities network and partially in generation, Fitch said.

The ratings are constrained by Energo-Pro's small size relative to other rated European utilities and cash-flow volatility, the agency said.

Operating environment and key-person risk stemming from ultimate ownership by one individual also are constraints, Fitch said.

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