TECO Energy comments on status of $350-million credit facility, Moody's outlook
TAMPA, November 13, 2002
TECO Energy (NYSE:TE) today reported that the company exercised its right to convert a $350-million credit facility to a one-year term loan while it continues to work toward renewing it with the banks.
Chairman and CEO Robert D. Fagan said, "We have commitments from a number of banks in the group, and this one-year term loan provision allows us to continue our negotiations with the banks with the goal of renewing the facility on a timely basis."
Moody's Investor Service today confirmed the company's credit rating of Baa2, but revised from "stable" to "negative" its outlook and made it clear that the rating is not on review for a possible downgrade.
Senior Vice President and CFO Gordon L. Gillette said, "This does not represent a change in our credit rating, nor does it activate any triggers in any of our financings. We will continue to keep the rating agencies and the public updated as we make further progress on the various components of our business plan, including renewal of this credit facility."
TECO Energy (NYSE: TE - News) is a diversified, energy-related holding company headquartered in Tampa. Its principal businesses are Tampa Electric, Peoples Gas System, TECO Power Services, TECO Transport, TECO Coal, and TECO Solutions.
Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. These forward-looking statements include references to the company's business plan for 2002 and 2003. Certain factors that could cause actual results to differ materially from those projected in these forward- looking statements include the following: energy price changes affecting TPS' merchant plants; TPS' ability to sell the output of the merchant plants operating or under construction at a premium to the forward curve prices and to obtain power contracts to reduce earnings volatility; any unanticipated need for additional equity capital that might results from lower than expected cash flow or higher than projected capital requirements; TECO Energy's ability to successfully complete the monetization of its synthetic fuel and gasification facilities, the sale of gas properties and other actions identified in its new business plan; TECO Energy's ability to maintain credit ratings sufficient to avoid posting letters of credit relating to its construction loans and to avoid providing additional assurances to counterparties; and TECO Energy's ability to complete its planned refinancing of notes on terms that qualify as a debt-for-debt exchange for accounting purposes. Others factors include: general economic conditions, particularly those in Tampa Electric's service area affecting energy sales; weather variations affecting energy sales and operating costs; potential competitive changes in the electric and gas industries, particularly in the area of retail competition; regulatory actions affecting Tampa Electric, Peoples Gas System or TECO Power Services; commodity price changes affecting the competitive positions of Tampa Electric and Peoples Gas System, as well as the margins at TECO Coalbed Methane and TECO Coal; changes in and compliance with environmental regulations that may impose additional costs or curtail some activities; TPS' ability to successfully construct, finance and operate its projects on schedule and within budget; the ability of TECO Energy's subsidiaries to operate equipment without undue accidents, breakdowns or failures; interest rates, credit ratings an other factors that could impact TECO Energy's ability to obtain access to sufficient capital on satisfactory terms; and TECO Coal's ability to successfully operate its synthetic fuel production facilities in a manner qualifying for Section 29 federal income tax credits, the use of which could be limited by taxable income or changes in law, regulation or administration. These factors and others are discussed more fully under "Investment Considerations" in the company's Current Report on Form 8-K filed on October 8, 2002.