Topic:"Securitization" in M12835

ova Scotia Power Incorporated 11931 4938 RC0001 1 2 3 4 5 6 Row Name of CFA Amounts determined for variable A in the definition of IFE for the affiliate Proportion determined under subsection 18.2(2) Amount G in Part 2K % Denied amount und...

AI summary The text provides a table with various financial and tax-related calculations, including amounts determined for variable A in the definition of IFE, proportions under subsection 18.2(2), denied amounts, and the corporation's share of denied amounts. The table includes references to tax years, percentages, and specific tax-related clauses.

NON-CONFIDENTIAL 1 Request IR-3: 2 3 Attachment 2, Note 17 – Short-Term Debt: 4 5 (a) Please explain the increase in short-term debt from nil in prior years to approximately 6 $500 million as at December 31, 2025. Please identify the princ...

AI summary The request asks NS Power to explain the increase in short-term debt to $500 million, its uses, and whether it is temporary or structural. NS Power responds that the debt was used to maintain liquidity and reduce revolving credit borrowings, and that the facility is temporary, to be repaid through an asset securitization transaction.

March 2, 2026 This report does not constitute a rating action. What's new: Nova Scotia Power Inc. (NSPI) ended fiscal year 2025 with funds from operations (FFO) to debt of 8.5%, which was materially below our 10.0% downgrade threshold. The...

AI summary Nova Scotia Power Inc. (NSPI) ended fiscal year 2025 with a funds from operations to debt ratio of 8.5%, below the downgrade threshold. The company faces challenges from a delay in securitizing thermal assets and a cyber-incident. NSPI is seeking rate increases and regulatory approval to securitize C$700 million of thermal assets.

Outlook The stable outlook on NSPI reflects our stable outlook on its parent Emera, as well as our expectation the company will improve its FFO to debt above 10% and maintain it at that level through 2027. This reflects our assumption NSPI...

AI summary The stable outlook for Nova Scotia Power Inc. (NSPI) is based on its parent company Emera's outlook and the expectation that NSPI will improve and maintain its FFO to debt ratio above 10% through 2027, assuming a constructive rate-case outcome and regulatory approval to securitize thermal assets.

Key Credit Rating Considerations The credit ratings of NSPI are based on its integrated electricity operations regulated by the Nova Scotia Energy Board (NSEB). The Stable trends reflect our expectations that the Company's key credit metri...

AI summary NSPI's credit ratings remain stable due to regulatory developments, including the sale of FAM assets and debt financing from NSPML. The establishment of NSIESO has streamlined NSPI's responsibilities. A GRA filing is expected to result in moderate rate increases, with securitization of thermal assets to meet environmental policies. However, legislative actions affecting NSEB's independence could lead to negative credit rating impacts.

Financial Outlook We expect NSPI's key credit metrics will remain supportive of the current credit ratings. The Company's key credit metrics recovered during 2024, following weakness in 2023, and continued to remain relatively stable durin...

AI summary NSPI's credit metrics are expected to remain stable, supported by debt reduction and fuel cost recoveries, despite high capital expenditures. A securitization deal in 2026 is anticipated to provide funding and reduce debt. NSPI's parent company, Emera, has historically supported the company with flexible dividend policies.

Reasonable Financial Profile NSPI's key credit metrics are reasonable for the current credit rating category. For the LTM 2025, the Company's key credit metrics were mostly in line with the current credit rating range, with total debt in t...

AI summary NSPI's key credit metrics are reasonable for its current credit rating category. For the LTM 2025, metrics such as total debt at 67.6%, cash flow-to-debt ratio at 15.8%, and EBIT interest coverage at 1.5 times are mostly in line with the current credit rating range. Credit metrics are expected to improve with the closure of a securitization deal in 2026.

an for 2025 totaled $692.4 million. - NSPI has a FAM in place that, subject to the NSEB's review and approval, allows the Company to recover fluctuating fuel expenses through annual rate adjustments. - In April 2024, NSPI sold $117 million...

AI summary NSPI has a Fuel-Adjustment Mechanism (FAM) in place to recover fluctuating fuel expenses through annual rate adjustments. In 2024, NSPI sold part of the FAM regulatory asset to the Province and received a federal government-guaranteed debt issuance to reduce the FAM balance. NSPI also filed a General Rate Application (GRA) for 2026-2027 with proposed rate increases and other adjustments.