S&P rates CERJ notes brA

Standard & Poor's said it assigned its Brazil national scale corporate credit rating of brA to Companhia de Eletricidade do Rio de Janeiro (CERJ), now called Ampla, and its brA issue credit rating to the company's five-year R$400 million debentures.

At the same time, the BB- global scale corporate credit ratings in local and foreign currencies were affirmed. The outlook on the corporate credit ratings in both scales is stable.

S&P said the ratings are supported by the company's balanced financial standing with credit metrics in line with the rating category; steady, sizable residential and commercial customer base, and monopoly franchise to distribute energy in part of the state of Rio de Janeiro; and minimal exposure to currency-mismatch risks.

The rating also reflects the following weaknesses: Ampla faces the challenge of reducing its high level of energy losses, thus restraining the company's capacity to improve cash generation; the company has a significant amount of historical past due receivables, which currently account for more than double monthly revenues; and the company is exposed to a new and evolving regulatory environment in Brazil, S&P said.

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