South Africa's dominant electricity utility. Vertical integration across the entire electricity value chain. Some negative regulatory intervention in tariff setting. Heightened operational risks owing to tight electricity margins in South Africa. Execution risks on a very large capital expenditure (capex) program. High leverage due to the largely debt-funded capex program. Weak credit metrics in the near term because tariff increases are insufficient to cover costs. Potential additional funding requirements in the next year if tariff increases are not approved annually as expected. The negative outlook on South Africa-based electricity utility ESKOM Holdings SOC Ltd. mainly reflects S&P Global Ratings' negative outlook on its long-term sovereign ratings on the Republic of South Africa (foreign currency BBB-/Negative/A-3, local currency BBB/Negative/A-2, South Africa
