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Watercare Services Ltd. Nov 06
Standard & Poors, November 2006
The ratings on Watercare Services Ltd. (Watercare) reflect the company's natural monopoly position, stable market demand, and intermediate financial risk profile. These strengths are offset by a constrictive and inflexible pricing regime, an increasing capital-expenditure requirement, weaker financial policies, and the potential for conflict due to customers being shareholders. Watercare's strong business position is underpinned by its natural-monopoly status in the provision of essential services. Watercare provides wholesale water services to six water retailers owned by local councils, as well as wholesale wastewater services to four of these retailers around the greater Auckland region. The water business contributes about 38% of revenues and EBITDA, and wastewater activities make up the remaining 62%. Solid demand, low volume volatility, and significant barriers...
Companies mentioned in this report are: Watercare Services Ltd.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Full Analysis
Watercare Services Ltd.