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Related
quotes
| FE |
34.37 |
- 0.40 |
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| 7/25/03 4:00:00 PM ET |
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TEXT-S&P comments on FirstEnergy Corp.
rating
Reuters, 07.25.03, 4:45 PM ET
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| (The following statement was
released by the rating agency)
NEW YORK, July 25 - Standard & Poor's Ratings
Services today noted FirstEnergy Corp.'s (nyse: FE
- news
- people)
(BBB/Negative/--) announcement of the latest extension of the Davis
Besse nuclear plant outage and the New Jersey Board of Public
Utilities (BPU) decision on subsidiary Jersey Central Power &
Light Co.'s rate case. With replacement power costs at about $90
million to $95 million in first-half 2003 and higher operating &
maintenance costs, now projected at $80 million, FirstEnergy's free
cash flows will be lower than expected. The BPU's decision on the
base rate, which adopted most, but not all, of the BPU staff's
recommendations, and the ruling on recovery of deferred energy costs
will also negatively affect FirstEnergy's deleveraging plans and
cash-protection measures. Cash flows will also be adversely affected
from additional capital investments to improve reliability in the
New Jersey shore communities.
Standard & Poor's estimates FirstEnergy's free
cash flow in 2003 at about $575 million. In the absence of material
asset sales or equity issuance, lower free cash will affect
FirstEnergy's ability to delever and achieve year-end 2003 targets.
Standard & Poor's will continue to assess the company's plans to
determine if projected financial measures are adequate for the
current rating.
Copyright
2003, Reuters News Service
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