Research Update: EP Bco S.A. Ratings Affirmed Following Implementation Of New Sector-Specific Criteria; Outlook Stable

We have completed our ratings review of EP Bco S.A under our new sector-specific corporate?criteria (see "Sector-Specific Corporate Methodology," published April 4, 2024) In our assessment of EP Bco's financial risk profile, we now apply the medial volatility table (versus the low volatility table previously applied), in line with the revised conditions for applying the benchmark volatility tables in the transportation infrastructure sector. This reflects our view that EP Bco is exposed to more earnings volatility than its peers in the infrastructure sector, because of its relatively high exposure to commodities. However, mitigating this exposure is our expectation that EP Bco will maintain S&P Global Ratings-adjusted funds from operations (FFO) to debt consistently above 8% and debt to EBITDA of

...- We have completed our ratings review of EP Bco S.A under our new sector-specific corporate criteria (see "Sector-Specific Corporate Methodology," published April 4, 2024) - In our assessment of EP Bco's financial risk profile, we now apply the medial volatility table (versus the low volatility table previously applied), in line with the revised conditions for applying the benchmark volatility tables in the transportation infrastructure sector. - This reflects our view that EP Bco is exposed to more earnings volatility than its peers in the infrastructure sector, because of its relatively high exposure to commodities. However, mitigating this exposure is our expectation that EP Bco will maintain S&P Global Ratings-adjusted funds from operations (FFO) to debt consistently above 8% and debt to EBITDA of up to 6.5x on average over 2024-2026. - We therefore affirmed our '##-' ratings on EP Bco S.A., its first-lien term loan, and its revolving credit facility (RCF). We also affirmed our 'B'...

Research Update