Important position in electricity supply in Korea, accounting for about 10% of national power capacity Low cyclicality of demand Lack of transparency in the mechanism to adjust electricity prices Expected electricity rate hikes to gradually improve operating cash flow Continuing negative free operating cash flow as a result of ongoing investments to construct additional power generation capacity The stable outlook on our ratings on Korea-based power generation company Korea Midland Power Co. Ltd. (KOMIPO) reflects the outlook on its parent, Korea Electric Power Corp. (KEPCO), given that the ratings on KOMIPO are closely related to KEPCO based on its core subsidiary status to the KEPCO group. We may lower the ratings on KOMIPO if we lower the ratings on KEPCO.
