PACRA Maintains Entity Ratings of Atlas Power Limited

Lahore, December 22, 2017 (PPI-OT):The ratings of APL reflect its strong financial profile. APL’s good credit terms with fuel supplier and efficient inventory management has enabled it better management of debt repayments. Nevertheless, delayed payments from the power purchaser remained a challenge. Despite higher receivable days the entity managed to sustain its financial strength. Business risk is considered low exhibited by demand risk coverage under Power Purchase Agreement signed between NTDC and the company.

The implementation agreement further provides sovereign guarantee for cash flows, given adherence to agreed performance benchmarks. The ratings incorporate low operational risk, a result of the performance of MAN Diesel Pakistan – the O and M operator. APL continues to meet its availability (88%) and efficiency (45%) benchmarks. APL has total long term debt of PKR 6,151 mln as at end-Jun17 payable till October 2019. Sound financial profile of Atlas Group; the major sponsor, provides comfort to the ratings.

Adherence to good financial discipline towards both financial and commercial obligations would remain important. Meanwhile, upholding strong operational performance in line with agreed performance levels remain important. Any significant increase in overdue receivables, in turn weakening in financial risk profile would be a concern.

For more information, contact:
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com

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