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Standard & Poor's reaffirm Itaipu's positive assessment
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On Wednesday (1st), for the fifth consecutive year, the agency Standard & Poor's Ratings Services reaffirmed the 'brAAA' rating for Itaipu Binacional on the Brazilian National Scale, 'BBB-' in foreign currency and 'BBB' local currency on a global scale. The analysis was undertaken after the publication of the company's 2015 financial results and confirms Itaipu's stable condition in relation to risk indicators. The SACP (Stand-alone credit profile) for Itaipu remains 'bb+'.

The rating is an evaluation of a country or company's capacity to balance its financial obligations. The brAAA assessment is the highest on the National Scale. "The stable outlook reflects our expectations that Itaipu will continue performing its fundamental role in the Brazilian electricity sector, and able to draw on extraordinary government support, if necessary", said the agency.

In the opinion of Itaipu's executive financial director, Ms. Margarte Groff, the result is a reflection of balanced and coherent management. "It is an assessment we receive with great satisfaction, as it reiterates the importance of excellence in financial management and technical management in order to ensure better energy production, coupled with good financial results", she said.

Further to the agency, the extended drought reduced the company's energy production in 2014, however, Itaipu was not exposed to the water risk, which ensured stability with an opportunity for revenue on the horizon. "Within this context, we evaluated the competitive advantage of the company as 'excellent', guaranteeing stability and a forecast for cash flow generation and the amortization of debts due up until 2023", stated S&P.

The report also states that the outlook for the rating over the next few years remains stable. "The plant will continue benefiting from the support shown by the Brazilian government. The entity's rating could be lowered in the event of an action similar to the Brazilian sovereign credit rating", it said.