Fitch upgrades Heartland Energy to ‘A,’ Outlook StableNovember 2, 2023
Heartland Energy has worked diligently to strengthen its financial profile. Sound decision making and a conservative approach have led to a rating upgrade.
Fitch Ratings recently announced an upgrade to ‘A’ with a stable outlook. Heartland Energy was previously rated at ‘A-‘.
“We have continuously improved our financial metrics,” said Heartland Energy CFO Mike Malone. “The rating upgrade shows our diligence has paid off.”
Fitch provides forward-looking credit opinions that reflect its expectations of credit behavior over a range of scenarios.
The upgrade to ‘A’ reflects an improved financial profile and declining leverage.
According to Fitch, Heartland Energy has bolstered liquidity and reduced direct debt in recent years through strong operating performance and cash flow.
A significant improvement was noted in leverage, measured as net adjusted debt to adjusted funds available for debt service, improving to 3.8x in 2022 from 7.8x in 2018.
Heartland Energy’s financial position drastically improved after the sale of the company’s portion of Laramie River Station in 2018.
“We have continued to make decisions with the long-term health of our financials and our customers in mind,” Malone said. “The stable outlook reflects Fitch’s expectation for ongoing financial stability, which we take great pride in.”
While Heartland Energy does not plan to issue any debt in the near future, the rating upgrade shows sound decision-making and future focus.
Resource diversity and adequate capacity were factored into a favorable operating risk.
Strong credit quality of Heartland’s customers also factored into the rating.
The entire report by Fitch can be found here.