Dominion Resources Comments on S&P Decision to Attach Negative Outlook; Says It Will Not Issue New Equity in Response.Business Editors RICHMOND, Va.--(BUSINESS WIRE)--Nov. 21, 2003 Dominion Resources Dominion NYSE: D (formerly Dominion Resources) is a power and energy company headquartered in Richmond, Virginia, USA, that supplies electricity, natural gas, or other energy services to homes in Virginia, West Virginia, Ohio, Pennsylvania, and eastern North Carolina. (NYSE NYSE See: New York Stock Exchange : D) today issued the following statement by Thos. E. Capps, chief executive officer, following a decision by Standard & Poor's (S&P) to revise Dominion's investment-grade credit outlook from Stable to Negative: "Dominion's credit ratios are stronger today than they were a year ago, when S&P last confirmed our BBB BBB A medium grade assigned to a debt obligation by a rating agency to indicate an adequate ability to pay interest and repay principal. However, adverse developments are more likely to impair this ability than would be the case for bonds rated A and above. plus rating with a Stable Outlook. Today's decision by S&P to place us on Negative Outlook is disappointing. It does not square with Dominion's deliberate, successful and ongoing policy to strengthen its credit ratios. Nor does it square with the assessments of professional fixed-income investors, who continue to invest in and have confidence in Dominion. "Unfortunately, S&P's standards for evaluating our industry continue to change, at times unexpectedly. So we will not penalize pe·nal·ize tr.v. pe·nal·ized, pe·nal·iz·ing, pe·nal·iz·es 1. To subject to a penalty, especially for infringement of a law or official regulation. See Synonyms at punish. 2. our equity investors by diluting earnings through a new equity issuance In financial markets, an Equity Issuance is the sale of new equity or "stocks" by a firm to investors. Equity Issuance can involve a private sale, in which the transaction between investors and the firm takes place directly, or publicly, in which case the firm has to to satisfy standards that are constantly changing. Instead, we expect to meet S&P's latest concerns by continuing to carry out our successful business plan while improving our strong credit ratios, including cash interest coverage and debt to capitalization. "In short, our fixed-income and equity investors can be assured that we are and will continue to be the company they know and trust." |
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