SOLARIA ENERGIA Y MEDIO AMBIENTE SA

EthiFinance Ratings upgrades the rating of Solaria Energía y Medioambiente, S.A. from 'BBB' to 'BBB+', maintaining its outlook 'Stable'. The company has been involved in the solar photovoltaic sector since 2002, where nowadays it's positioned as a leading developer and producer in the Spanish market. Currently, the company keeps growing its generation capacity, reaching 2.8 GW in operation and construction (96% in Spain) with most of the projects with power purchase agreements (75% of sales). In 2022, when the energy market was characterized by the high pool prices and the addition of more capacity, Solaria obtained a total revenue of € 167.4M (+51% YoY), maintaining a positive profitability (EBITDA margin of 88%), which allows the company to have its financial expenses adequately covered. Operating cash flow generation is positive but insufficient to fund its investment program, which is financed through debt. In fact, the support of debt for growth keeps being a key point for the company (NFD/EBITDA of 5.4x), an aspect mitigated by the positive visibility of revenue and a financial structure based on a long-term 'non-recourse debt' with an intensive use of Project Finance.