{"id":15061,"date":"2012-09-28T17:08:39","date_gmt":"2012-09-28T15:08:39","guid":{"rendered":"http:\/\/www.myza.co.za\/09\/text-sp-summary-rand-water\/"},"modified":"2012-09-28T17:08:39","modified_gmt":"2012-09-28T15:08:39","slug":"text-sp-summary-rand-water","status":"publish","type":"post","link":"https:\/\/www.myza.co.za\/press\/text-sp-summary-rand-water\/","title":{"rendered":"TEXT-S&P summary: Rand Water"},"content":{"rendered":"

\t\t<\/span><\/p>\n

<\/span><\/p>\n

<\/span><\/p>\n

In accordance with our criteria for government-related entities (GREs), our
\nrating approach is based on our view of Rand Water’s:<\/p>\n

<\/span><\/p>\n

— “Critical” role as the monopoly bulk water provider to the Gauteng
\nregion, the economic heartland of South Africa. Rand Water is the country’s
\nlargest water board and acts in an agency capacity on behalf of the government
\nin providing an essential commodity to municipalities, the population, and to
\nlarge industrial customers. The South African government does not envisage the
\ncorporatization or privatization of any of the water boards for the
\nforeseeable future.<\/p>\n

<\/span><\/p>\n

— “Integral” link as a not-for-profit, fully government-owned entity
\nthat performs a strategic development role and pays neither dividends nor
\ntaxes. The Department of Water Affairs (DWA), which owns all 14 water boards
\nin South Africa, closely supervises and approves Rand Water’s strategy, its
\nbudget, and its management to ensure the implementation of government policy.<\/p>\n

<\/span><\/p>\n

<\/span><\/p>\n

We continue to monitor the development of Rand Water’s role and link to the
\ngovernment of South Africa. A change in our assessment of an “almost certain”
\nlikelihood of extraordinary government support could result in us no longer
\nequalizing the rating on Rand Water with that on the sovereign, in which case
\nthe SACP would become an increasingly important driver of the rating.<\/p>\n

<\/span><\/p>\n

Rand Water’s SACP of ‘bbb+’ reflects our assessment of the company’s
\n“satisfactory” business risk profile and “intermediate” financial risk
\nprofile. The business risk profile is supported by Rand Water’s regional
\nmonopoly position, its government ownership and mandate, and its solid
\noperational track record. The main constraint on Rand Water’s business risk
\nprofile is the lack of independent regulation, with an annual cost recovery
\nsystem that is exposed to political influence and does not always provide for
\nfull and timely cost recovery. In addition, the company has significant
\ncustomer concentration.<\/p>\n

<\/span><\/p>\n

Our view of Rand Water’s “intermediate” financial risk profile reflects the
\ncompany’s currently strong credit metrics, supported by a net cash balance.
\nThe implementation of a five-year South African rand (ZAR) 10 billion
\ninvestment program including bulk sanitation and cogeneration projects will
\nrequire Rand Water to raise new external debt going forward. We believe that
\nthis requirement, combined with an increase in operating costs, is likely to
\nweaken Rand Water’s financial profile.<\/p>\n

<\/span><\/p>\n

\n\u00a0 Continued…<\/strong><\/span><\/p>\n

<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

In accordance with our criteria for government-related entities (GREs), our rating approach is based on our view of Rand Water’s: — “Critical” role as the monopoly bulk water provider to the Gauteng region, the economic heartland of South Africa. Rand Water is the country’s largest water board and acts in an agency capacity on behalf […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","ngg_post_thumbnail":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[830,2370,183],"class_list":{"0":"post-15061","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-south-africa","7":"tag-news","8":"tag-reuters","9":"tag-south-africa-2","10":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/15061","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/comments?post=15061"}],"version-history":[{"count":0,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/posts\/15061\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/media?parent=15061"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/categories?post=15061"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.myza.co.za\/press\/wp-json\/wp\/v2\/tags?post=15061"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}