S&P pulls Granite Generation from watch

S&P said it affirmed its B+ issuer rating on Granite Generation LLC and removed it from CreditWatch where it was placed with negative implications on Feb. 15. The outlook is negative.

The agency recently lowered its assumptions for future capacity prices in the Pennsylvania-New Jersey-Maryland Interconnection (PJM), which reduced its cash flow forecast for Granite.

“Relative to our previous assumptions, we now forecast Granite will generate about $200 million less cumulative capacity revenue through 2025. Because capacity revenue has no incremental variable cost, this decline flows directly through to our measure of the company's EBITDA,” S&P said in a press release.

Granite delivered EBITDA of about $300 million in 2021. The agency said it estimates EBITDA of about $250 million in 2022 and $220 million in 2023. This translates to 2022 and 2023 leverage of 4.9x and 5.4x, respectively. “While we do not incorporate any assumptions about the company's 2024 metrics in our forecast, we don't expect its EBITDA will materially improve from 2023 levels during the year.”

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.