Rating Release

Agusto & Co. hereby upgrades the rating of North South Power Company Limited to “A”

The rating expires on 30 June 2024.

Agusto & Co. hereby upgrades the rating of North South Power Company Limited (“North South Power”, “NSP” or “the Company”) to “A”. The rating upgrade reflects improvements in the Company’s financial condition depicted by good cash flow, adequate working capital, moderate leverage and a stable and experienced management team. Agusto & Co. also positively considers NSP’s strategic position in the electricity generation market, supplying 8% of the country’s capacity with the ability to restart other generating plants following a blackout. In addition, we note positively that NSP was able to reach an agreement with the Bureau of Public Enterprises (BPE) for the settlement of concession liabilities which had been outstanding since 2018. However, the rating is impaired by high trade receivables from Nigeria Bulk Electricity Trading Plc (NBET) and high exchange losses.

North South Power is the licensed operator of the 600MW Shiroro hydroelectric power plant (‘Shiroro’ or ‘the Shiroro Plant’). The Company generates and sells electricity to the distribution companies through NBET under the terms stipulated in a power purchase agreement (PPA) and in line with the electricity market rules. In addition to NBET, NSP supplies
electricity to a single customer under the ‘Eligible Customer Regime’, with tariffs agreed under independent terms and secured by a power purchase agreement.

The opinions expressed in this rating release do not represent any investment or other advice and should therefore not be construed as such. Visit www.agusto.com for further information.