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Timely gas price hike credit positive for KOGAS: Moody's

All Headlines 17:19 July 10, 2018

SEOUL, July 10 (Yonhap) -- Moody's Investors Service said Tuesday a timely gas price increase is credit positive for state-run utility Korea Gas Corp. (KOGAS).

In July, KOGAS increased its average gas tariff for retail city gas distributors by 4.2 percent to reflect higher liquefied natural gas (LNG) import costs and the South Korean currency's weakness against the dollar, the global ratings agency said in a report.

"The tariff increase is credit positive for KOGAS because it will improve the company's funds from operations (FFO) and credit metrics over the next 12-18 months," the report said.

Moody's expects the tariff increase to bolster KOGAS' annual FFO by 250 billion-350 billion won to 2.1 trillion-2.2 trillion won during the cited period.

In the January-March period, KOGAS posted a net profit of 781.13 billion won (US$700 million), up 56 percent from 500.12 billion won a year earlier. Operating profit rose 17 percent year-over-year to 963.5 billion won on sales of 8.772 trillion won, a 14 percent on-year gain.

Korea Gas Corp.'s main office in Daegu, southeast of Seoul (Yonhap)

kyongae.choi@yna.co.kr
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