Published: 2019-10-15 12:36:53 CEST

Moody's affirms Latvenergo AS credit rating at investment grade

On 15 October, the international credit rating agency Moody's has affirmed the credit rating of Latvenergo AS at investment grade Baa2 with stable outlook.

Riga, 2019-10-15 12:36 CEST -- Upon affirmation of the credit rating of Latvenergo AS, Moody's has taken into consideration the expected unbundling of transmission system assets from Latvenergo AS. According to the decision of the Cabinet of Ministers of the Republic of Latvia the unbundling has to be implemented until 1 July 2020. The plan is to implement the unbundling through a reduction of the share capital of Latvenergo AS, removing the capital shares of Latvijas elektriskie tīkli AS from the base of its assets. After the capital shares of Latvijas elektriskie tīkli AS become property of the state, it is planned to invest them in the share capital of Augstsprieguma tīkls AS.

By setting the credit rating of Latvenergo AS, Moody’s has particularly appreciated Latvenergo's strong competitive position in the domestic electricity market, its cost-competitive and environmentally clean hydro generation asset base, a strong contribution from regulated distribution activities as well as strong financial profile.

Guntars Baļčūns, Chief Financial Officer of Latvenergo AS: “The credit rating Baa2 affirmed by the international credit rating agency Moody’s confirms the solid financial performance of Latvenergo Group, allowing raise loans and issue bonds on attractive financing terms.”

Apart from the financial sector, Latvenergo AS is the only company in Latvia with an investment grade rating assigned by international credit rating agency. The credit rating is used by local and international financial institutions for evaluating the company’s credit risk and it facilitates the company to attract financing on favorable terms. Moody's has been assigning the credit rating of Latvenergo AS since 2004 and it has been Baa2 with stable outlook since 2015.

Additional information:
Jānis Irbe
Group Treasurer

Phone: +371 67 728 239

About Latvenergo

Latvenergo Group is one of the leading energy suppliers in the Baltics operating in electricity and thermal energy generation and trade, natural gas trade, electricity distribution services and lease of transmission system assets. Latvenergo AS has been acknowledged as the most valuable company in Latvia for several times. International credit rating agency Moody's has assigned Latvenergo AS an investment-grade credit rating of Baa2/stable.

Latvenergo Group is comprised of the parent company Latvenergo AS (generation and trade of electricity and thermal energy, trade of natural gas) and seven subsidiaries - Latvijas elektriskie tīkli AS (lease of transmission system assets), Sadales tīkls AS (electricity distribution), Elektrum Eesti OÜ (trade of electricity and natural gas in Estonia), Elektrum Lietuva UAB (trade of electricity and natural gas in Lithuania), Enerģijas publiskais tirgotājs AS (administration of mandatory electricity procurement process) and Liepājas enerģija SIA (generation and trade of thermal energy in Liepaja, electricity generation). All shares of Latvenergo AS are owned by the state and held by the Ministry of Economics of the Republic of Latvia.