The Saudi Electricity Company (SEC) has achieved a credit rating upgrade to “A+” from “A”, aligning with the sovereign rating of the nation, according to a recent press announcement.
SEC’s Chief Executive Officer, Eng. Khaled Al-Gnoon, expressed satisfaction with the upgrade, stating, We are pleased with this positive upgrade of SEC’s credit ratings, which stands as a testament to the efforts and investments we continue to make to bolster the reliability and efficiency of the electrical grid.
He cited the company’s exemplary governance, alignment with the Ministry of Energy, Saudi Arabia’s decarbonization agenda, and robust financial standing as key factors influencing the improved rating.
The rating agency Fitch highlighted SEC’s sound decision-making processes, strong government backing, and adherence to national policies as pivotal reasons for the rating enhancement. The firm emphasized the government’s 81% ownership, strategic management, and SEC’s integral role in the country’s decarbonization initiatives as evidence of this support.
SEC’s upgraded financial position is attributed to the transformation of SAR168 billion of the company’s liabilities into equity-like instruments, providing leverage flexibility and assured cash flow. This financial stability is deemed vital for the Kingdom’s energy strategy.
In the first quarter of 2024, SEC’s growth trajectory included a capital expenditure program of SAR10.5 billion, aimed at enhancing generation, transmission, and distribution projects to support the anticipated surge in electricity demand.
The company reported a significant financial performance in the same quarter with SAR15.9 billion in revenue, a 9.1% increase in EBITDA to SAR6.8 billion, and an 87% surge in net profit, reaching SAR897 million.