TEXT-S&P: EnerCare Inc rating unchanged on notes issue

Fri Nov 16, 2012 1:27pm EST
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Nov 16 - Standard & Poor's Ratings Services today said that its ratings on
EnerCare Inc. and subsidiary EnerCare Solutions Inc. (both rated
A-/Stable/--) are unchanged after the company issued C$250 million senior
unsecured notes due 2017 to refinance its upcoming C$240 million maturity. The
new notes are also rated 'A-'. The ratings on EnerCare reflect our view of the
company's strong business risk profile, characterized by the well-established
position of its portfolio of rental water heaters, and an intermediate financial
profile with moderate debt leverage. We believe that recent debt reduction and
lower leverage are important support for the rating, considering the shift in
EnerCare's business mix and pressure for shareholder returns. We base the stable
outlook on our expectation that steady cash flow from water heater rentals will
support the growth of EnerCare's submetering business, while maintaining fully
adjusted debt to EBITDA of about 3x.