S&P revises KeySpan view to negative

Standard & Poor's said it affirmed its A issuer credit rating on KeySpan Gas East Corp. and revised the outlook to negative from stable.

The action reflects the potential for lower ratings in the absence of indications that the company will be able to maintain its historical levels of financial performance while consistently earning at levels above its authorized returns.

The ratings on parent National Grid North America Inc. remain unaffected.

"The rating affirmation on KeySpan Gas East reflects our current assessment of the company's business risk profile as ‘excellent’ and its financial risk profile as ‘intermediate,’” S&P credit analyst Dimitri Nikas said in a news release.

The negative outlook reflects the potential for lower ratings by up to one notch absent indications that the company will be able to maintain its historical levels of financial performance supported by its ability to earn at levels consistently above its authorized returns, the agency said.

Under its base-case scenario, S&P expects KeySpan Gas East will achieve FFO/debt of 17% to 18% with debt to EBITDA in the 4.5 times to 5 times range.

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