TECO Energy outlook remains strong - Charlotte Business Journal:

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billion in debt held by and subsidiariesand Co. The ratingy is supported by the underlyinh strengthof TECO’s regulated electric and gas utility subsidiary, from whichh it derives stable cash distributions to meet its funding requirements, Fitch said a release. Tampa Electrixc continues to post strongcredit metrics, it maintainzs solid operating performance and it benefitse from Florida’s constructive regulatory Fitch said. Fitch is however, about slowing customer growth atTampza Electric.
But the company has responded to slower growth by postponing projects to increase electric Another concern for Fitch is cash flow deteriorationb atTECO (NYSE: TE) Guatemala because of the adverser rate order in 2008, unplanned outages at the San Jose uncertainty over the extension of a purchased power and the potential for deferred or renegotiated contractws because of declining market higher production costs and slumping demand for coal. TECO Coal and TECO Guatemal a provide roughly 20 percent of theparent company’s consolidatedc earnings before interest, taxes, depreciation and amortization, Fitcu said.
Credit ratios at Tampa Electricd should benefit from higher base rates in 2009 and 2010 as a resul ofa $138 million rate order approved in March, Fitch said. In addition, an affiliatw waterborne transportation agreement that reducedTampa Electric’s annual net incoms by $10 million in prioe years is expiring. Fitch expectds coverage ratios to remain relatively strong with fundxs from operations coverage at nearly five timesin 2009. TECO Coal is expecterd to benefit from highee priced contracts signedin 2008.
soft coal demand and higher mining productionm costs at TECO Coal raise the risks ofcontractuapl non-performance by counter-parties and pressured Diverse regulatory orders and operatinv issues at the Guatemalan operations will resulyt in dividend distributions that are lower than historic levels. TECO's liquidith position is considered strong, Fitch said. Cash and cash equivalentz were $34.9 million and available crediy facilitieswere $530 million as of March 31. Liquidituy was enhanced by a netoperating loss-ta x carry forward of $547.5 milliohn as of Dec. 31, whichj is expected to result in minimak cash tax paymentsthrough 2012.
In addition, TECO'e $100 million note maturing in 2010 is expectedr to be retired with internal Positive rating action could result in the futured from consolidated leverage ratio reductionj in 2010 and higher cash flowx from a full year of higher base ratess in 2010 and effectivecost control.