The Standard and Poor's (S&P) credit rating agency has confirmed state power board Hrvatska Elektroprivreda's (HEP) BB long-term credit rating, and has upgraded its outlook from stable to positive, in line with its recent upgrade of Croatia's credit rating, HEP reported on Thursday.

Last Friday S&P retained Croatia’s credit rating at BB+, but upgraded its outlook from stable to positive, thanks to expectations that Croatia’s economy will continue to grow while fiscal indicators will further improve.

Due to the methodology and criteria S&P uses in rating HEP, the upgrade has come after the country’s outlook was recently upgraded, HEP said in a press release.

S&P notes in a report released on Wednesday that HEP has maintained solid metrics over the past few years as well as relatively stable cash flows.

It also said that it will likely raise ratings on HEP if ratings on Croatia are raised.

“We are satisfied with the upgrade of outlook from stable to positive and with the confirmation of HEP’s long-term credit rating. In that regard, we will continue to actively manage HEP Group’s financial status and overall business operations,” HEP CEO, Frane Barbaric, said.

State-owned HEP is the largest electricity producer and supplier in the country. In 2017 it posted a total profit of 364 million kuna (€49 million), out of which 60 percent, or 218.4 million kuna (€29.4 million), was paid into the state budget.

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