Korea Ratings·KR Downgrades SK Eturnix Short-Term Credit Rating from 'A3+' to 'A3'

Korea Ratings·KR announced on May 29 that it has downgraded SK Eturnix's short-term credit rating from A3+ to A3.

On the same day, Korea Ratings·KR stated that it adjusted SK Eturnix's short-term credit rating as above and maintained the company on its watchlist for possible downgrade review.

SK hynix 'Yeongwol Gwangjeon No.1' Solar Power Plant Panorama. SK hynix

Korea Ratings·KR cited the expected decline in total sales and deterioration of the profit base after 2027, due to reduced wind power and fuel cell EPC revenue, as the background for the rating adjustment.

Korea Ratings·KR explained, "After 2027, the scale of wind power EPC revenue will decrease and the fuel cell EPC business is scheduled to end, so the company is expected to experience negative growth in total sales compared to the past. The reduction in wind power and fuel cell EPC revenue will not only decrease total sales, but also weaken the company's profit-generating base."

Additionally, despite maintaining EBITDA generation capacity, Korea Ratings·KR forecasted that increased short- and medium-term borrowing burdens will weaken the company's financial stability. "Due to the nature of power plants operated from a long-term perspective, the initial equity contribution burden is high, and the company is covering the resulting funding shortfall through borrowings," Korea Ratings·KR stated. "While EBITDA generation capacity is being maintained, the increased borrowing burden associated with equity investment is expected to somewhat weaken financial stability in the short- to medium-term," the agency explained.

This content was produced with the assistance of AI translation services.