1st Nov 2019 11:28
(Alliance News) -Â Moody's Investors Service on Thursday assigned a Baa3 long-term issuer rating to Vivo Energy PLC with a stable outlook.
"The Baa3 rating assigned to Vivo Energy reflects its strong credit metrics and liquidity, its conservative financial policy, and the resilience of its business profile despite the exposure to some high risk countries in Africa" says Douglas Rowlings, a Moody's vice president senior analyst.
The rating factors in that Vivo operates only in Africa and is thus exposed to the risks of operating in countries with sub-investment grade ratings. However, Vivo benefits from significant geographical diversification, Moody's said, with operations in 23 countries.
The stable outlook is predicated on Vivo maintaining its liquidity buffers and adhering to "conservative financial policies", notably keeping its net debt to earnings before interest, tax, depreciation and amortisation ratio below 1.5 times.
"Vivo's rating is currently constrained at Baa3 by the country risk overlay of its African operating jurisdictions and scale of operating cash flow generation," said Moody's.
Vivo shares in London were down 0.7% at 122.00 pence, while in Johannesburg, the stock was untraded at ZAR23.99.
By Lucy Heming;Â [email protected]
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