Primary Credit Analyst: Massimo Schiavo, Paris + 33 14 420 6718; [email protected]
Secondary Contacts: Claire Mauduit-Le Clercq, Paris + 33 14 420 7201; [email protected] Gonzalo Cantabrana Fernandez, Madrid (34) 91 389 6955; [email protected] Pierre Georges, Paris (33) 1-4420-6735; [email protected]
Table Of Contents
Credit Highlights
Outlook
Our Base-Case Scenario
Company Description
Business Risk
Financial Risk
Liquidity
Environmental, Social, And Governance
Issue Ratings--Subordination Risk Analysis
Reconciliation
Ratings Score Snapshot
Related Criteria
www.spglobal.com/ratingsdirect April 23, 2019 1 Naturgy Energy Group S.A.
Business Risk: STRONG Issuer Credit Rating Vulnerable Excellent bbb bbb bbb
BBB/Stable/A-2 Financial Risk: SIGNIFICANT
Highly leveraged Minimal
Anchor Modifiers Group/Gov't
Credit Highlights
Overview
Key Strengths Key Risks High share of low-risk regulated gas and power distribution activities in Aggressive shareholding structure, with 40% of share capital owned by Spain and Latin America, generating stable and predictable cash flows. infrastructure and private equity funds. Good geographic and group diversification, mainly linked to operations Reduced capital expenditures (capex) in the 2018-2022 strategic plan, growth in the international liquefied natural gas (LNG) midstream with cost-cutting potentially compromising longer-term cash flow sector and in Latin America. generation. Industrial and commercial integration of electricity and gas business in One of the most aggressive dividend policies among Europe's largest Spain. integrated utilities. Strong liquidity, supported by a conservative 24-month prefunding Gas, power, and service sales and international LNG (about 33% of 2018 policy. EBITDA), could suffer as a result of a weak operational performance and increasing competition.
Naturgy Energy Group S.A.'s (Naturgy's) cashflows are stable and predictable thanks to its fully regulated electricity and gas distribution activities (67% of 2018 EBITDA). The company's credit profile benefits from a higher contribution from fully regulated activities in Spain, Latin, and Central America than for other European integrated utility players.
Naturgy's gas, power, service sales, and international LNG (about 33% of 2018 EBITDA) continue to suffer as a result of a weak operating performance and increasing competition. Despite strong results in 2018 thanks to lower procurement costs and better pricing environment in LNG, we see some potential long-term risks of underperformance in the business division. Naturgy is a relatively small player in LNG, thus not fully benefiting from economies of scale and vertical integration in the gas value chain, and is exposed to gas price fluctuations in the service sales business.
Naturgy stands out among European integrated utilities due to the relatively low contribution of renewable assets to its current generation portfolio.Although the company plans to double its exposure to renewables over 2018-2022 by adding an additional 1 gigawatt (GW) of installed capacity, Naturgy is more focused on providing the base load with combined cycle gas turbines (CCGTs).
The company's aggressive dividend policy, reduced capex in the 2018-2022 strategic plan, and cost-cutting could compromise longer-term cash flow generation.Naturgy's dividend policy stands out as one of the most aggressive amongst the European integrated utilities, based on dividends per share (DPS), with Naturgy targeting €2 billion of shares buyback over 2018-2022, absent meaningful investment opportunities.
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40% of Naturgy's share capital is owned by infrastructure and private equity funds.Two of Naturgy's main shareholders are Rioja Bidco Shareholdings (20.1%), which is 75% and 25% owned by CVC and Corporación Financiera Alba respectively, and Global Infrastructure partners (20%).
Outlook: Stable
S&P Global Ratings' stable outlook on Spain-based vertically integrated gas and electricity utility Naturgy incorporates our expectation that, over 2019-2020, the company will maintain funds from operations (FFO) to debt of over 18%. We also consider the group's commitment to cost-cutting, which should compensate for the aggressive and inflexible shareholder remuneration policy established as part of the 2018-2022 strategic plan.
Downside scenario
We could downgrade Naturgy if its adjusted FFO to debt does not remain above 18% over 2019-2020, or if its operating performance deteriorates. The fixed and aggressive dividend policy over 2018-2022 leaves Naturgy limited headroom for underperformance. We will closely monitor, in particular, Naturgy's performance in gas, power, service sales, and the LNG businesses, given the company's weak results in the past.
In our base case, we don't anticipate sizable debt-financed acquisitions. We will closely monitor the evolution of the company's strategy and the potential impact of the company's plan on capital structure optimization.
Upside scenario
We could consider a positive rating action if the group's adjusted FFO to debt improved sustainably to more than 20% over 2019-2020, combined with a good operating performance. Any positive action will ultimately depend on Naturgy's successful execution of operating efficiencies outlined in the 2018-2022 strategic plan.
Our Base-Case Scenario
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Assumptions Key Metrics
• Improving macroeconomic conditions in countries where Naturgy operates. In particular, we expect 2018a 2019e 2020e 2021e continued real GDP growth in Spain, Chile, and EBITDA (bil. €) 4.1 4.5-4.6 4.6-4.8 4.6-4.8 Mexico at a rate above or close to 2% over Debt (bil. €) 17.3 17.3-17.5 17.6-17.8 17.8-18.0 2019-2021. In Brazil, while growth should remain Dividends (bil. €) 2.0 1.7-1.8 1.7-1.8 1.8-1.9 subdued in 2018, we expect real GDP will increase Capex (bil. €) 1.8 1.7-1.8 1.4-1.5 1.3-1.4 by more than 2% over 2019-2021. FFO to debt (%) 18.2 18.0-19.0 18.5-19.5 18.0-19.0 • Power prices will improve in Spain, but remain Debt to EBITDA (x) 4.2 3.7-4.0 3.7-4.0 3.7-4.0 below €55 per megawatt hour (MWh) for 2019-2020. Cash flow generation will remain supported by * All figures are S&P Global Ratings adjusted. Naturgy's high share of regulated activities.
• Revenues remaining about stable over 2019-2021. a--Actual. e—Estimate • Average EBITDA margins of about 19% over 2019-2021. • Proceeds of about €350 million from disposals in 2019. • Capex averaging €1.6 billion over 2019-2021. • Dividends, including to minority shareholders, averaging €1.8 billion over 2019-2021. • Average interest rate on debt of about 3.1% in 2018, versus 3.4% in 2017, and averaging 3.2% over 2019-2021. • No operational underperformance compared with targets outlined in the 2018-2022 business plan. • Negative free cash flow after capex and dividends over 2019-2021.
Base-Case Projections Naturgy's adjusted EBITDA in 2018 was at €4.1 billion versus our expectation of €4.3 billion due to higher-than-expected capture costs (€180 million) resulting from implementation of the efficiency plan.In 2018, DPS increased by 30% to €1.30 per share and Naturgy also invested €121 million in buying back shares as part of its €400 million annual buy-back to be completed by the end of June 2019. S&P Global Ratings-adjusted debt decreased to about €17.3 billion from €18.3 billion in 2017 thanks to about €1.5 billion of disposals. As a result, adjusted FFO to debt was 18.2%, compared with 14.8% in 2017. In 2019, Naturgy expects reported EBITDA of about €4.6 billion.
Company Description
Spain-based Naturgy is a vertically integrated utility with leading positions in the gas and power value chain in Spain and Latin America. Naturgy supplies gas and electricity to almost 22 million customers in over 30 countries.
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In Spain, Naturgy is the incumbent gas utility. It is the largest gas distribution operator, with more than 5.4 million gas distribution points in 2018. It is also the third-largest electricity distributor, after Endesa and Iberdrola, with more than 3.7 million electricity distribution points in 2018.
Naturgy is the largest wholesale and retail supplier of natural gas, with more than 197,000 gigawatt hours (GWh) of gas supplied in 2018 (versus more than 195,000 GWh in 2017). It is also one of the largest power generators in Spain, with 28,307GWh of electricity generated in 2018 (versus 27,953 GWh in 2017) and more than 80% of the generation portfolio coming CCGT plants and coal. In Latin America, Naturgy is the largest electricity distribution and transmission company and one of the leading gas distributors in Chile. It also enjoys a top-tier position in Brazil in gas distribution and supply.
Naturgy is also active in the LNG business; its fleet of LNG carriers had a capacity of 1.2 billion cubic meters (bcm) in 2018, which increased from 1.0 bcm in 2017.
In 2018, Naturgy reported revenues of €24.3 billion and EBITDA of €4.0 billion.
Chart 1
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Chart 2
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Chart 3
Business Risk: Strong
Naturgy's strong business risk profile hinges on the group's sizable share of low-risk regulated gas and electricity activities, its resilient business model, international diversification, and flexible international gas midstream operations. Naturgy continues to suffer from weak, albeit improving gas supply margins, as highlighted by the 2018 results.
The high share of predictable regulated network earnings supports stability More than 60% of Naturgy's earnings come from regulated activities, about half of which are in Spain and the rest in South America, mainly Chile. Although we view the regulatory frameworks in South America as somewhat weaker than in Spain, we view Naturgy's diversification and operating efficiency favorably, in particular since Naturgy took over Compania General de Electricidad (CGE) in Chile, a country we regard as having a stable and transparent regulatory framework.
In Chile, gas distribution operations enjoy a real return cap of 9% after tax. Electricity transmission and distribution activities have four-year regulatory periods, regulated real remuneration on investments of 10% before tax, and the pass-through of energy costs.
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In Brazil, Colombia, and Mexico, distribution-operation tariffs are not exposed to commodity-price, transport, or local-inflation risk. Regulatory periods span five years, providing good earnings visibility. In Argentina, the integral tariff review was implemented in April 2018. We view the Argentinian regulatory framework weaker than that of the rest of Naturgy's regulated activities in the region.
Generation activities in Spain remain challenging Naturgy's business risk profile is somewhat hampered by its material exposure to the Spanish gas and electricity markets. About 10% of estimated 2019 earnings come from Spanish power generation activities, which are exposed to weak and declining power prices. Power prices will likely remain below 55€/MWh, according to S&P Global Platts.
Naturgy stands out among European integrated utilities due to the relatively low contribution of renewable assets to its generation portfolio. The company was awarded 926 MW of renewable capacity to be built before January 2020 in the 2016-2017 renewables auctions in Spain. However, as highlighted in the report "The End To Subsidies: The Beginning Of A New Era For Spanish Renewables?", published Feb. 7, 2018, on RatingsDirect, the remuneration scheme for the recently awarded renewables is much weaker than what we have seen so far in Europe.
Naturgy's generation portfolio is more carbon dioxide (CO2)-intensive than some other integrated peers, and we therefore might see the company increasingly involved in renewable projects at a global level over the next three years.
Chart 4
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Peer comparison Table 1 Naturgy Energy Group S.A.--Peer Comparison
Industry Sector: Energy
Naturgy Energy Group EDP - Energias de Portugal S.A. S.A. Enel SpA Iberdrola S.A. Rating as of April 23, 2019 BBB/Stable/A-2 BBB-/Stable/A-3 BBB+/Stable/A-2 BBB+/Stable/A-2 --Fiscal year ended Dec. 31, 2018-- --Fiscal year ended Dec. 31, 2017--
(Mil. €) Revenues 24,339.0 15,278.1 74,437.0 31,263.3 EBITDA 4,127.5 3,207.0 14,993.0 7,482.2 FFO 3,150.3 2,455.1 8,724.5 5,898.3 Interest Expense 673.2 708.6 2,469.5 1,279.1 Cash Interest Paid 714.2 686.9 4,689.5 1,041.7 Cash flow from operations 2,949.3 2,398.2 10,366.5 5,030.1 Capital expenditures 1,800.0 1,674.9 8,499.0 6,259.4 Free operating cash flow 1,149.3 723.3 1,867.5 (1,229.3) Discretionary cash flow (1,107.7) (156.1) (1,616.0) (2,526.2) Cash and short-term 1,696.0 1,720.3 6,781.7 3,205.1 investments Debt 17,293.1 18,147.4 45,244.4 37,439.9 Equity 13,734.0 13,275.3 54,314.5 42,185.9
Adjusted ratios EBITDA margin (%) 17.0 21.0 20.1 23.9 Return on capital (%) 4.8 5.5 10.5 5.4 EBITDA interest coverage (x) 6.1 4.5 6.1 5.8 FFO cash interest coverage (x) 5.4 4.6 2.9 6.7 Debt/EBITDA (x) 4.2 5.7 3.0 5.0 FFO/debt (%) 18.2 13.5 19.3 15.8 Cash flow from 17.1 13.2 22.9 13.4 operations/debt (%) Free operating cash flow/debt 6.6 4.0 4.1 (3.3) (%) Discretionary cash flow/debt (6.4) (0.9) (3.6) (6.7) (%)
Compared with peers Enel, EDP, and Iberdrola, Naturgy enjoys a higher portion of EBITDA from fully regulated power and gas networks activities, which represented more than 65% of 2018 EBITDA. In the case of Enel and Iberdrola they represented more than 50%, and for EDP, about 30%.
Compared with the aforementioned peers, Naturgy has a more aggressive shareholders' remuneration, which is based on increased DPS over 2018-2022, coupled with share-buyback in the amount of €2 billion in the same time period, absent significant investment opportunities. In the case of Enel, EDP, and Iberdrola, it is based on payout ratio, which is at 70% over 2019-2021 for Enel, 75%-85% for EDP, and 65%-75% for Iberdrola.
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Financial Risk: Significant
We forecast that, over the next three years, Naturgy will maintain FFO to debt at 18% or higher. In its 2018-2022 strategic plan Naturgy has outlined the most aggressive dividend policy among Europe's integrated utilities. In 2019, we expect Naturgy will pay out a total of about €1.8 billion in dividends (including to minority shareholders), compared with about €2.0 billion in 2018. More generally, the dividend per share will increase to €1.3 per share in 2018 from €1.0 per share in 2017 and then gradually increase to €1.59 per share in 2022. Over 2018-2022, we expect the dividend-to-capex ratio will average 1.0x, which is below that of the other integrated utilities we rate in Europe.
Chart 5
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Chart 6 Chart 7
Financial summary Table 2 Naturgy Energy Group S.A.--Yearly Data
Industry Sector: Energy --Fiscal year ended Dec. 31--
2018 2017 2016 2015 2014
(Mil. €) Revenues 24,339.0 23,306.0 23,184.0 26,015.0 27,828.0 EBITDA 4,127.5 3,920.5 4,771.5 5,075.0 5,120.5 FFO 3,150.3 2,712.9 3,367.4 3,506.1 3,427.9 Interest Expense 673.2 737.6 907.1 986.9 1,016.6 Cash Interest Paid 714.2 772.6 879.1 973.9 944.6 Cash flow from operations 2,949.3 2,816.9 3,389.4 3,392.1 2,746.6 Capital expenditures 1,800.0 1,766.0 2,135.0 1,767.0 1,453.3 Free operating cash flow 1,149.3 1,050.9 1,254.4 1,625.1 1,293.3 Discretionary cash flow (1,107.7) (203.1) (268.6) 578.6 46.7 Cash and short-term investments 1,696.0 3,215.9 2,067.0 2,390.0 3,572.0 Gross available cash 1,696.0 3,215.9 2,067.0 2,390.0 3,572.0 Debt 17,293.1 18,329.8 18,853.4 18,645.7 20,243.1 Equity 13,734.0 17,444.0 18,144.0 17,658.0 16,773.5
Adjusted ratios EBITDA margin (%) 17.0 16.8 20.6 19.5 18.4 Return on capital (%) 4.8 5.6 7.7 9.0 10.2 EBITDA interest coverage (x) 6.1 5.3 5.3 5.1 5.0 FFO cash interest coverage (x) 5.4 4.5 4.8 4.6 4.6 Debt/EBITDA (x) 4.2 4.7 4.0 3.7 4.0
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Table 2 Naturgy Energy Group S.A.--Yearly Data (cont.)
Industry Sector: Energy --Fiscal year ended Dec. 31--
2018 2017 2016 2015 2014
(Mil. €) FFO/debt (%) 18.2 14.8 17.9 18.8 16.9 Cash flow from operations/debt (%) 17.1 15.4 18.0 18.2 13.6 Free operating cash flow/debt (%) 6.6 5.7 6.7 8.7 6.4 Discretionary cash flow/debt (%) (6.4) (1.1) (1.4) 3.1 0.2
FFO--Funds from operations.
Liquidity: Strong
We view Naturgy's liquidity as strong, given its proactive financing and healthy cash flow generation. We estimate that the company's sources of liquidity will exceed projected uses by more than 1.5x over the next 12 months, and by more than 1.0x over the next 24 months.
Our assessment of Naturgy's liquidity is further supported by the company's sound banking relationships, prudent financial discipline, and proven access to the international debt capital markets.
Principal Liquidity Sources Principal Liquidity Uses
We anticipate the following principal liquidity sources We anticipate the following principal liquidity uses for the 12 months started in Dec. 31, 2018: over the same time period:
• Reported access to about €1.7 billion in unrestricted • Capex of about €2.0 billion; cash, of which more than 85% is at the parent • Debt maturities of about €2 billion; company; • Working capital outflows of about €150 million; and • Access to about €5.0 billion under available committed credit facilities, maturing in more than • Dividends of about €1.8 billion. one year; and • Forecast cash FFO of approximately €3.3 billion in the next 12 months.
Debt Maturities
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Chart 7
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Environmental, Social, And Governance
From an environmental standpoint, Naturgy's generation portfolio compares unfavorably with those of other European integrated utilities due to the relatively low contribution of renewable assets and its relatively high CO2 intensity (more than 80% generated from CCGT plants and coal). The company was awarded 926 MW of renewable capacity to be built before January 2020 in the 2016-2017 renewables auctions in Spain, but the company still lags behind its European peers. We believe its long-term position is, however, linked to the future relevance of gas.
Naturgy's ownership structure and governance has changed radically over the past two years, with investment funds (Global Infrastructure Partners and CVC) now majority shareholders. We believe this has materially changed the company's operating model and financial policy to be increasingly skewed toward shareholders. We believe this could translate into accrued social risks over time. We note a reduction in capex in the new 2018-2022 strategic plan, and believe cost-cutting could compromise the quality of network services and overall longer-term cash flow generation. In addition, Naturgy's 140 managers benefit from a new five-year (2018-2022) Long Term Incentive Plan, which is based on total shareholders' return (share price appreciation plus dividends paid over the period of the strategic plan), and replaces the previous annual scheme that was dependent on operational targets. As a result, this new plan might lead the management to opt for shareholder's remuneration maximization, which could impair the company's longer-term cash flow generation.
Furthermore, we see increasing scrutiny from network regulators regarding the balance of interest between stakeholders, which Naturgy may be penalized for over time. In Spain, the regulator is proposing the introduction of leverage limitations, while in Colombia Naturgy is in a legal dispute with the government, which decided to take over the management of the power distribution company Eletricaribe at the end of 2016. In the summer of 2016, Naturgy notified Colombian authorities of a likely controversy in light of an international agreement of mutual investments between Spain and Colombia, due to the debt accumulated with subsidiary Electricaribe, of which the Spanish company owned an 85% share.
Issue Ratings--Subordination Risk Analysis
Capital structure Naturgy's policy is to issue all debt at the parent company via its financial subsidiaries, and lend the proceeds to its operating companies. Our calculation of structural subordination is at about 20% (compared with 11% in 2017), however, because of the amount of operating debt at the subsidiaries. As part of its 2018-2022 strategic plan, Naturgy will probably increase (or "push down") the amount of debt at the subsidiaries' level, which we will continue to monitor. We believe that Naturgy's size, diversity of cash flow generation, and direct ownership of a significant amount of operating assets may be a strong mitigating factor to structural subordination issues.
Analytical conclusions The issue rating on Naturgy's senior unsecured debt is 'BBB', in line with the issuer credit rating, since currently no significant elements of subordination risk are present in the capital structure.
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Reconciliation
Table 3 Reconciliation Of Naturgy Energy Group S.A. Reported Amounts With S&P Global Ratings' Adjusted Amounts (Mil. €) --Fiscal year ended Dec. 31, 2018--
Naturgy Energy Group S.A. reported amounts
S&P Cash flow Shareholders' Operating Interest Adjusted from Capital Debt equity EBITDA income expense EBITDA operations Dividends Expenditures 15,431.0 10,948.0 3,840.0 (2,167) 557.0 4,127.5 2,881.0 1,976.0 1,808.0
S&P Global Ratings' adjustments Cash taxes paid ------(263) ------Cash taxes paid ------Other Cash Interest Paid ------(621) ------Operating leases 888.3 -- 161.5 55.2 55.2 (55.2) 106.3 -- -- Debt-like hybrids 110.0 (110) -- -- 2.0 (1) (1) (1) -- Intermediate hybrids 751.0 (751) -- -- 29.0 (29) (29) (29) -- reported as equity Postretirement 221.0 ------15.0 ------benefit obligations/deferred compensation Accessible Cash & (1,696.0) ------Liquid Investments Capitalized interest ------8.0 (8) (8) -- (8) Share-based -- -- 5.0 ------compensation expense Dividends received -- -- 184.0 ------from equity investments Asset retirement 285.8 ------7.0 ------obligations Non-operating ------(477) ------income (expense) Non-controlling -- 3,647.0 ------Interest/Minority interest Debt - Derivatives (85) ------Debt - Lease 1,318.0 ------Liabilities Not Included in Reported Debt Debt - Put options 69.0 ------on minority stakes EBITDA - -- -- (21) (21) ------Gain/(Loss) on disposals of PP&E EBITDA - Other -- -- (42) (42) ------
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Table 3 Reconciliation Of Naturgy Energy Group S.A. Reported Amounts With S&P Global Ratings' Adjusted Amounts (Mil. €) (cont.) D&A - Impairment ------4,270.0 ------charges/(reversals) Total adjustments 1,862.1 2,786.0 287.5 3,785.2 116.2 (977.2) 68.3 (30.0) (8.0)
S&P Global Ratings' adjusted amounts
Funds Cash flow Interest from from Dividends Capital Debt Equity EBITDA EBIT expense operations operations paid expenditures 17,293.1 13,734.0 4,127.5 1,618.2 673.2 3,150.3 2,949.3 1,946.0 1,800.0
Ratings Score Snapshot
Issuer Credit Rating BBB/Stable/A-2
Business risk: Strong • Country risk: Intermediate • Industry risk: Low • Competitive position: Strong
Financial risk: Significant
Anchor: bbb
Modifiers • Diversification/Portfolio effect: Neutral (no impact) • Capital structure: Neutral (no impact) • Financial policy: Neutral (no impact) • Liquidity: Strong (no impact) • Management and governance: Satisfactory (no impact) • Comparable rating analysis: Neutral (no impact)
Stand-alone credit profile : bbb • Group credit profile: bbb • Related government rating: A-
Related Criteria
• Criteria - Corporates - General: Reflecting Subordination Risk In Corporate Issue Ratings, March 28, 2018
• General Criteria: Methodology And Assumptions: Assigning Equity Content To Hybrid Capital Instruments Issued By Corporate Entities And Other Issuers Not Subject To Prudential Regulation, Jan. 16, 2018
www.spglobal.com/ratingsdirect April 23, 2019 16 Naturgy Energy Group S.A.
• General Criteria: Methodology For Linking Long-Term And Short-Term Ratings, April 7, 2017
• Criteria | Corporates | General: Methodology And Assumptions: Liquidity Descriptors For Global Corporate Issuers, Dec. 16, 2014
• Criteria - Corporates - Industrials: Key Credit Factors For The Unregulated Power And Gas Industry, March 28, 2014
• Criteria | Corporates | Industrials: Key Credit Factors For The Midstream Energy Industry, Dec. 19, 2013
• Criteria | Corporates | General: Corporate Methodology: Ratios And Adjustments, Nov. 19, 2013
• General Criteria: Group Rating Methodology, Nov. 19, 2013
• General Criteria: Methodology: Industry Risk, Nov. 19, 2013
• Criteria - Corporates - Utilities: Key Credit Factors For The Regulated Utilities Industry, Nov. 19, 2013
• General Criteria: Country Risk Assessment Methodology And Assumptions, Nov. 19, 2013
• Criteria | Corporates | General: Corporate Methodology, Nov. 19, 2013
• General Criteria: Methodology: Management And Governance Credit Factors For Corporate Entities And Insurers, Nov. 13, 2012
• General Criteria: Criteria Clarification On Hybrid Capital Step-Ups, Call Options, And Replacement Provisions, Oct. 22, 2012
• Criteria | Financial Institutions | General: Methodology: Hybrid Capital Issue Features: Update On Dividend Stoppers, Look-Backs, And Pushers, Feb. 10, 2010
• General Criteria: Use Of CreditWatch And Outlooks, Sept. 14, 2009
• Criteria | Insurance | General: Hybrid Capital Handbook: September 2008 Edition, Sept. 15, 2008
Business And Financial Risk Matrix
Financial Risk Profile Business Risk Profile Minimal Modest Intermediate Significant Aggressive Highly leveraged Excellent aaa/aa+ aa a+/a a- bbb bbb-/bb+
Strong aa/aa- a+/a a-/bbb+ bbb bb+ bb Satisfactory a/a- bbb+ bbb/bbb- bbb-/bb+ bb b+ Fair bbb/bbb- bbb- bb+ bb bb- b Weak bb+ bb+ bb bb- b+ b/b- Vulnerable bb- bb- bb-/b+ b+ b b-
Ratings Detail (As Of April 23, 2019)* Naturgy Energy Group S.A. Issuer Credit Rating BBB/Stable/A-2 Issuer Credit Ratings History 28-Nov-2013 BBB/Stable/A-2 15-Oct-2012 BBB/Negative/A-2
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Ratings Detail (As Of April 23, 2019)*(cont.) 17-Dec-2010 BBB/Stable/A-2 Related Entities Naturgy Mexico S.A. de C.V. Issuer Credit Rating CaVal (Mexico) National Scale mxAA+/Stable/-- Senior Unsecured CaVal (Mexico) National Scale mxAA+ *Unless otherwise noted, all ratings in this report are global scale ratings. S&P Global Ratings’ credit ratings on the global scale are comparable across countries. S&P Global Ratings’ credit ratings on a national scale are relative to obligors or obligations within that specific country. Issue and debt ratings could include debt guaranteed by another entity, and rated debt that an entity guarantees.
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