The Negative Outlook reflects increased leverage in 2024, with additional large growth investments in the next few years expected to limit deleveraging potential, which has resulted in a weaker financial risk profile.

The affirmation reflects Scope's unchanged view that Lyse can sustain good credit metrics amid the ongoing investment phase in its telecommunications division.

The rating upgrade is driven by the improved financial risk profile enabled by higher power prices despite significant growth investments in telecommunications.

Continued high energy prices and the acquisition of telecoms company Ice balance each other out to bring Lyse’s financial risk profile back within Scope’s long-term Outlook.

Thanks to an extraordinary 2021 with high power prices and related high cash generation, Scope expects the acquisition of Ice's mobile phone operations to have a contained impact on credit ratios.

The upcoming EBITDA improvement is largely driven by continued telecoms growth, newly added capacity through the Hydro RSK assets, and higher power prices.

The updated analysis is based on 2019 annual results as well as Scope's medium-term expectations of the effects of lower electricity prices in the Nordics in 2020, a trend which already began before the Covid-19 outbreak.

The affirmation is driven by a strong 2018 result, with record-high power production and notable develeveraging, coupled with Scope's anticipation of 2019 credit metrics being influenced by continued high investment and lower production.

The affirmation is driven by stable operational development in all of Lyse’s main business segments, which has limited adjustments to our longer-term forecast for the company.

Scope Ratings today assigns a first-time corporate issuer rating of BBB+ to Norway-based Lyse AS. The Outlook is Stable. Scope also assigns an S-2 short-term rating. The senior unsecured debt issued by Lyse is rated BBB+.