Fitch affirms Heartland Energy’s ‘A’ credit rating

Rating reflects ongoing strong financial management

Fitch Ratings has affirmed the ‘A’ rating of Heartland Energy with a stable outlook. 

The rating is based on an assessment of an entity’s vulnerability to defaulting on its financial obligations. It is used by investors to understand the risk of purchasing that entity’s debt. Risk is assessed over a period longer than one year.

A rating of ‘A’ denotes expectations of low default risk. The capacity for payment of financial commitments is considered strong. 

Heartland’s rating was previously upgraded to A from A- in 2023 after diligent efforts to improve financial metrics.

“We continue to base decisions on the long-term financial strength of Heartland, which in turn provides stability for our customers,” said Heartland Chief Financial Officer Mike Malone. 

A strong rating enhances a company’s overall credibility, lowers operational costs and provides greater financial flexibility for future opportunities.

Contributing factors

The Fitch rating underscores Heartland’s robust financial standing and prudent fiscal management.

Heartland has a stable financial profile, characterized by consistent revenue streams, cost control, and debt reduction. 

Fitch noted continued improvement in leverage, measured as net adjusted debt to adjusted funds available for debt service, improving to 5.1x in 2024 from 6.5x in 2020. 

Additionally, Heartland’s liquidity position remains strong, providing a solid buffer against any unexpected challenges.

The stable outlook reflects Fitch’s expectation that Heartland will maintain its current financial trajectory, supported by its diversified power supply portfolio and proactive risk management strategies.

The company’s ability to adapt to evolving energy markets and regulatory landscapes further enhances its creditworthiness.

This affirmation is a testament to Heartland’s effective governance and operational efficiency, ensuring reliable and affordable power to customers while maintaining financial stability.

Heartland looks forward to continuing to deliver reliable, affordable power while planning responsibly for long-term needs of customers.

The entire report by Fitch can be found here.