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Investing.com -- S&P Global Ratings has revised TC Energy Corp.’s outlook to stable from negative while affirming its ’BBB+’ issuer credit rating, citing the company’s strong operational performance and capital discipline.
The rating agency noted that TC Energy’s debt-to-EBITDA ratios are projected to improve to 4.8x in 2025 and 4.7x in 2026, a significant reduction from 5.6x in 2022. This improvement is supported by long-term take-or-pay contracts that provide stable and predictable cash flows.
TC Energy has enhanced its financial performance through successful rate-case implementations and a strategic shift toward more frequent rate-case reviews. The company also completed its Southeast Gateway project in Mexico in May 2025, which came in under budget and is expected to contribute additional contracted cash flow.
S&P Global highlighted TC Energy’s transition from large, capital-intensive projects to a more focused approach on smaller, strategic investments within its existing infrastructure. The company has outlined a disciplined financial policy with annual net capital expenditure forecast at approximately C$6 billion, including maintenance capital and continued investment at Bruce Power.
Despite these improvements, S&P Global noted that TC Energy does not have a significant cushion to the rating threshold. The rating agency expects the company will make necessary adjustments to maintain debt-to-EBITDA metrics below 4.75x in the coming years.
A negative rating action could occur if adjusted debt to EBITDA rises above 4.75x in 2026 and beyond, while a positive rating action, though unlikely, could happen if TC Energy commits to keeping debt to EBITDA consistently below 4.25x.
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