S&P: RWE view to negative

Standard & Poor’s said it revised the outlook on RWE AG to negative from stable.

The agency also said it affirmed the company’s BBB+ long-term and A-2 short-term corporate credit ratings.

The outlook revision reflects the persistent low power prices in RWE’s main markets, which have been further exacerbated by weak commodity prices, S&P said.

These factors could weigh on the company’s operating cash flows and its ability to pursue de-leveraging in adverse market conditions after the bulk of its asset-disposal program has been completed, the agency said.

Although S&P said it acknowledges that RWE successfully managed its efficiency program, the opportunity for further cost reductions is diminishing.

Therefore, the profitability of RWE’s operations remains exposed to further decline, the agency said.

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