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      Scope has completed a monitoring review for Borkum Riffgrund 2 Investor Holding GmbH
      WEDNESDAY, 18/01/2023 - Scope Ratings GmbH
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      Scope has completed a monitoring review for Borkum Riffgrund 2 Investor Holding GmbH

      No action has been taken on the senior notes issued by Borkum Riffgrund 2 Investor Holding GmbH. Credit metrics remain robust, benefitting from the effects of high wind speeds and energy prices.

      Scope Ratings GmbH (Scope) monitors and reviews its credit ratings on an ongoing basis and at least annually, or every six months in the case of sovereigns, sub-sovereigns and supranational organisations.

      Scope performs monitoring reviews to determine whether material changes and/or changes in macroeconomic or financial market conditions could have an impact on the credit ratings. Scope considers all available and relevant information when undertaking the monitoring review.

      Monitoring reviews are conducted by performing a peer comparison, benchmarking against the rating-change drivers, and/or reviewing the credit ratings’ performance over time, as deemed appropriate by the Lead Analyst or Analytical Team Head, in addition to an assessment of all aspects of the relevant methodology/ies, including key rating assumptions and model(s). Scope publicly announces the completion of each monitoring review on its website.
       
      Scope completed the monitoring review for Borkum Riffgrund 2 Investor GmbH on 13 January 2023 for the A- rating on the senior secured notes with a current outstanding balance of EUR 503.1m.

      This monitoring note does not constitute a credit rating action, nor does it indicate the likelihood that Scope will conduct a credit rating action in the short term. Information about the latest credit rating action connected with this monitoring note along with the associated rating history can be found on www.scoperatings.com.

      Key rating factors

      The A- rating reflects a total expected loss of 0.14% over the notes’ life until maturity, equivalent to a 3.24-year constant-exposure expected risk horizon. Key drivers are the low risks during operation, especially regarding sponsors and revenue generation, as well as the strong financial figures and the resilience to cash flow stress scenarios. The project features an almost fully amortising structure with a 12% balloon followed by a long remaining useful asset life.

      Revenue generation was better than Scope’s expectations in the nine months ending September 2022. This was mainly due to the high wind speeds in January, February, April and July, as well as the sharp increase in energy prices in the third quarter of 2022 to well above the guaranteed tariff. As a result, EBITDA was 10% above Scope’s rating case assumptions in the nine months ending September 2022. The technical availability of the wind turbines and of the total project were also significantly higher than expected. Scope expects full-year cash flow to exceed its forecasts based on the year-to-date performance.

      Credit metrics have remained robust and well within Scope’s rating case assumptions. The most recent compliance certificate for the period between 30 June 2021 and 30 June 2022 confirmed satisfactory financial ratios. The historical and projected debt service coverage ratios were 1.24 times and 1.41 times respectively, while the note life coverage ratio reached 1.37 times. The rolling 12-month debt service totalled EUR 97.5m by 30 June 2022 (30 June 2021: EUR 98.9m).

      The methodologies applicable for the reviewed rating (General Project Finance Rating Methodology, 16 November 2022; Counterparty Risk Methodology, 14 July 2022) are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
      This monitoring note is issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0.
      Lead analyst: Torsten Schellscheidt, Managing Director

      © 2023 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Analysis GmbH, Scope Investor Services GmbH, and Scope ESG Analysis GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5 D-10785 Berlin. 

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