As the third-largest power utility in The Netherlands, the company represents significant portion of the domestic electricity and gas markets; About 80.0% of operating profit derives from regulated monopoly network businesses; and Conservative financial profile. Aggressive competition in liberalized energy retail markets is squeezing retail operating margins; Volatile wholesale market prices could be detrimental to the company's cash flow; and Regulated distribution network tariffs are set on harsh assumptions. The ratings on the Dutch energy distribution group, Eneco Holding N.V. and its subsidiary ENECO N.V. (collectively ENECO Energie), reflect its strong cash flows from its monopoly energy distribution businesses, prudent energy trading activities, and conservative financial policy. These strengths are offset by increasing competitive pressures and the potential exposure of
