Rating action

Scope Ratings GmbH (Scope) has today affirmed the long-term issuer rating of Ferde AS at AA+, in both local and foreign currency. Scope has also affirmed Ferde’s short-term issuer ratings at S-1+ in both local and foreign currency. All Outlooks are Stable.

Moreover, Scope has affirmed the local-currency, long-term senior unsecured debt ratings at AAA for issuances guaranteed by Rogaland and Agder, as well as for the Ryfast project, co-guaranteed by Rogaland and Stavanger (all AAA/Stable), and at AA+ for issuances guaranteed by Vestland (AA+/Stable). Short-term local-currency debt ratings remain at S-1+, all with Stable Outlooks.

• The two outstanding S-1+/Stable-rated short-term certificates guaranteed by Agder have the following ISINs: NO0013682898, NO0013637942.
   
• The outstanding S-1+/Stable-rated short-term certificate guaranteed by Rogaland has the following ISIN: NO0013685263.
   
• The five outstanding S-1+/Stable-rated short-term certificates guaranteed by Vestland have the following ISINs: NO0013684092, NO0013555441, NO0013665869, NO0013648337, NO0013661074.
   
• The three outstanding S-1+/Stable-rated short-term certificates for the Ryfast project have the following ISINs: NO0013669192, NO0013673186, NO0013670505.

For the accompanying rating report, please see here.

Rating rationale

The AA+/Stable issuer rating for Ferde AS (Ferde), reflects several key elements:

• Integration with the public sponsors: Ferde benefits from strong collaboration with its owner counties and operates within a well-defined regulatory framework, enhancing Ferde's cash flow predictability and supporting its strategic role in regional toll collection. Unlike commercially driven toll operators, Ferde prioritises public policy goals over profit, focusing on paying down separate road projects as tolls are collected, as reflected in high annual depreciation levels.
   
• Control, regular support, and likelihood of exceptional support: Ferde's role as a government-related entity (GRE) underpins its critical role in financing major toll road infrastructure and managing toll stations in support of regional development and national transportation plans. This is supported by substantial financial backing from debt guarantees provided by the owner counties for the debt issuances, ensuring favourable financing conditions for infrastructure projects.
   
• Stand-alone fundamentals: Ferde demonstrates strong standalone fundamentals, underpinned by a strong market position across its shareholder counties, a stable and predictable toll revenue base, and robust profitability reflected in high EBITDA margins. The entity’s debt structure is favourable, supported by long maturities. High leverage, substantial capital expenditure needs, and limited flexibility to independently adjust toll rates are credit challenges inherent to its business profile.

Each project’s debt issuance benefits from explicit county or municipal guarantees under established project-specific frameworks, resulting in an alignment of the issuance rating with that of the guarantor. This results in AAA ratings for issuances guaranteed by Rogaland and Agder, as well as for the Ryfast project co-guaranteed by Rogaland and Stavanger (all AAA/Stable), and an AA+ rating for issuances guaranteed by Vestland (AA+/Stable).

Key rating drivers

The AA+ issuer rating reflects the robust integration of Ferde with the public sponsors, which underpins Scope’s adoption of its ‘top-down’ approach to the ratings.

Ferde is a regional toll company in southwestern Norway (AAA/Stable), jointly owned with equal shares by the county municipalities Agder (AAA/Stable), Rogaland (AAA/Stable), and Vestland (AA+/Stable). Ferde's primary function is to finance road projects by collecting tolls on government-owned roads. The general mandate is regulated by the main road toll agreement (Bompengeavtalen) between the Ministry of Transport and Ferde. Road maintenance is typically handled by the Norwegian Public Roads Administration (NPRA) and other public entities.

The projects undertaken by Ferde align with long-term county transportation plans, enhancing the entity's cash flow predictability. The company's activities are also coordinated with the NPRA, ensuring alignment with national transportation policies. This strong government collaboration supports Ferde's strategic positioning in toll collection across its owning counties, underpinned by strong economic fundamentals that ensure sustainable demand for its services.

Ferde's participation in the NPRA's "Regulations 2030 – User Financing" initiative, directed by the Ministry of Transport and Communications, including the review of toll provisions in the Road Act, highlights its alignment with national regulatory goals.

The AA+ rating is further supported by the strong control and high financial support from the public sponsors, as well as the high likelihood of exceptional support for Ferde if needed.

Ferde holds significant strategic importance to its public sponsors due to its essential role in regional transportation infrastructure. This is a primary county responsibility, which together with education represent the majority of county operating expenditure. Its exclusive role in toll revenue collection and management, which is vital for funding key infrastructure projects, reinforces Ferde’s strategic importance to the counties. In case of financial challenges, this strong alignment with core public services increases the probability that sponsors would intervene to ensure Ferde’s continued operation.

Ferde operates under a governance framework where its mission, strategy, as well as operational and financial activities are strongly influenced and defined by public law and resolutions from its public sponsors. This coordination ensures that Ferde’s strategic undertakings align with national transportation goals.

While public subsidies only make up a small amount of operating revenue (5% in 2024), Ferde benefits from debt guarantees provided by county governments, which cover the debt issuances and loans associated with its specific projects. These guarantees facilitate financing under favourable terms to fund extensive regional transportation projects. Looking ahead, selected projects are expected to qualify for partial state co-guarantees, which would reduce contingent liabilities for the counties and support more favourable financing terms.

Finally, the AA+ rating considers Ferde’s robust standalone fundamentals.

Ferde demonstrates robust standalone fundamentals with a solid market position in its owner counties, a stable toll revenue base and consistent toll income growth, high profitability, indicated by substantial EBITDA margins, and a favourable debt profile. High leverage, significant capital expenditures, and limited flexibility in adjusting toll rates independently are credit challenges inherent to the business profile.

Ferde operates as the regional toll company for the counties of Agder, Rogaland, and Vestland in Norway. The agreement between the Ministry of Transport and Ferde AS (Bompengeavtalen) grants Ferde a monopoly on toll collection within these regions. The strong economic fundamentals in Ferde's counties, with growing urban centers, transport routes, and diverse geography, support Ferde’s stable revenue potential from commuting, industrial transport, and tourism, despite constraints on toll rate adjustments.

Ferde has limited flexibility in setting toll rates as is the case for other toll operators in Norway, as toll rates and toll road projects are set through multi-stakeholder agreements involving local and national governments. Ferde can address toll rate limitations through inflation adjustments and mechanisms to align rates with the Government Proposition, particularly when discounted EV tolls reduce averages. Some of these measures require local political approval. In cases of financial strain on section-specific projects, Ferde may request a 20% toll rate increase and/or a five-year extension of the collection period. For urban packages, potential financial strain necessitates prioritisation among executed projects within the managed portfolio. Moreover, strong government collaboration and a regulatory framework that supports a structured approach to toll rate setting, ensure that any changes in toll rates are consistent with long-term planning. This framework, coupled with efficient project management within, has proven appropriate in the past. Potential deviations are flagged early due to ongoing monitoring allowing for timely correction. Currently, only two projects are slightly behind schedule (E39 Kristiansand West-Lyngdal West and Rv 13 Ryfast). However, we also expect these to be completed on time after necessary adjustments.

Ferde maintains a high average EBITDA margin of 93% over the past five years, with 94% in 2024, reflecting its resilient business model and disciplined cost management. The financial strategy emphasises achieving break-even performance. The high depreciation of collection rights aligns with Ferde’s business model, as these rights are amortised over the predetermined project lifespan commencing at project initiation.

Ferde’s high EBITDA margin and predictable toll revenue contribute to strong cash flow, supporting its financial stability despite high leverage and significant capital expenditure. This stability, alongside conservative debt management and county guarantees, enhances Ferde’s resilience to economic fluctuations and mitigates refinancing risks.

Ferde’s Debt/EBITDA ratio reflects high leverage, improving from 8.11 in 2020 to 6.67 in 2024. Total liabilities grew from NOK 22.83bn in 2019 to NOK 29.31bn in 2024, with a 5% average annual growth rate, highlighting continued reliance on debt to finance infrastructure and toll collection projects.

Ferde’s capital expenditures are substantial, driven by a cyclical investment strategy targeting major infrastructure phases, such as in 2019 and 2023. Its CAPEX/Operating Income ratio of 142% in 2023 reflects heavy reliance on external financing. While the ratio declined to 80% in 2024, it remains elevated. At the end of Q2 2025, Ferde’s total debt portfolio stood at NOK 26.3bn, up from NOK 24.9bn six months earlier. Debt is projected to exceed NOK 30bn by 2027, primarily reflecting financing needs for major projects such as E39 Rogfast and Rv 555 Sotrasambandet. Beyond 2027 the planned E16 Arna – Stanghelle project is expected to become a significant driver of further debt issuance¹. For the Rogfast project, toll collection will only start after the opening of the tunnel in 2031, toll collection for the E16 is even further off with an expected construction period of 12-14 years. Hence, these projects are expected to negatively affect Ferde’s debt metrics in the short to medium term. Nevertheless, risks are mitigated by conservative debt management practices and substantial project-level guarantees of up to NOK 16bn for Rogfast and NOK 10bn for E16 Arna-Stanghelle.

Ferde has shifted towards a diversified funding strategy, increasing bond market financing from 30% in 2019 to 62% in Q2 2025 while reducing reliance on institutional lenders like Kommunalbanken AS (KBN), whose share dropped from 33% to 12%. Certificates account for 15% of liabilities at end-June 2025, up from 14% at end-2019 but down from 19% at end-2023, reflecting a more market-oriented approach that balances flexibility with exposure to market risks like interest rate volatility. To manage refinancing risks, Ferde employs a staggered bond maturity schedule with regulatory caps on annual maturities. A majority of loan debt remains variable, with 51.3% hedged to mitigate interest rate risk, contributing to a well-balanced debt profile. The average interest rate after hedging rose from 2.29% in 2022 to 3.85% in 2023 due to rising market rates and stood at 4.20% at end-June 2025.

Additionally, Ferde’s debt profile is supported by debt guarantees provided by the owner counties for the loans taken and bonds issued, ensuring favourable financing conditions for infrastructure projects. As of end-September 2025, Ferde benefited from total guarantee frameworks amounting to NOK 68bn. With debt outstanding representing only about half of this amount, the remaining capacity provides Ferde with ample flexibility to raise additional funding and support the progress of ongoing road projects as needed.

Finally, Ferde benefits from a solid liquidity position, with access to internal lending mechanisms that further mitigate liquidity risk. At end-2024, Ferde reported surplus liquidity of NOK 4.3bn, with almost NOK 3bn in bank deposits and the remaining NOK 1.3bn in interest rate and bond funds. Liquidity holdings are foremost determined by the urban portfolio-managed projects under development and will vary depending on building activity. While cross-subsidisation is prohibited across the different projects, Ferde remains the option to provide internal loans. While this option is usually not advantageous in the long term, it is an additional risk mitigating factor and provides short-term flexibility for the timing of other transactions.

Rating-change drivers for the issuer ratings

The Stable Outlook reflects Scope’s view that risks to the ratings are balanced over the coming 12 to 18 months.

Upside scenario for the ratings and Outlooks is:

1. Stronger integration with the owning counties.

Downside scenarios for the rating and Outlooks are (individually or collectively):

1. Deterioration of the combined credit quality of public sponsors;
    
2. Weaker integration with the owning counties, for instance via changes to the legal framework or the funding model; and/or
    
3. Significant and sustained deterioration of its business risk profile and/or financial risk profile.

Rating-change drivers for guaranteed issuances

The Stable Outlooks for the issuances reflect Scope’s view that risks to the ratings are balanced over the coming 12 to 18 months.

Rogaland-guaranteed issuances:

The downside scenario for the rating and/or Outlooks is:

1. If the ratings or Outlooks of Rogaland County Municipality are downgraded.

Agder-guaranteed issuances:

The downside scenario for the rating and/or Outlooks is:

1. If the ratings or Outlooks of Agder County Municipality are downgraded.

Vestland-guaranteed issuances:

The upside scenario for the rating and/or Outlooks is:

1. If the ratings or Outlooks of Vestland County Municipality are upgraded.

The downside scenario for the rating and/or Outlooks is:

1. If the ratings or Outlooks of Vestland County Municipality are downgraded.

Ryfast project issuances:

The downside scenario for the rating and/or Outlooks is:

1. If the ratings or Outlooks of Rogaland County Municipality and/or the City of Stavanger are downgraded.

Qualitative Scorecards (QS1, QS2)

Scope applies a top-down approach (QS1) in assessing the creditworthiness of Ferde. The starting point is Scope’s average credit quality of the three county owners of Ferde AS, which is AAA. This average is then potentially negatively adjusted based on the assessment of: i) control and regular support; and ii) likelihood of exceptional support (QS2). The approach also includes a supplementary analysis of the entity’s stand-alone fundamentals.

The adoption of the top-down approach (QS1) reflects the strong integration between Ferde and its public sponsors, the counties with ownership stakes, resulting from: i) a ‘limited’ integration assessment for legal status, ii) ‘high’ integration assessment for Ferde’s purpose and activities; iii) a ‘high’ integration assessment regarding its shareholder structure; and iv) a ‘high’ integration assessment on financial interdependencies.

Scope assesses control and regular government support for Ferde as ‘high’ (QS2) as a result of: i) the ‘high’ government control over Ferde’s strategic and operational decision-making; ii) the ‘high’ control over its key personnel, governing and oversight bodies; and iii) the ‘high’ evidence of financial support.

Scope assesses the likelihood of exceptional support to be ‘high’ (QS2), reflecting: i) a ‘high’ assessment for strategic importance for the public sponsor; ii) ‘medium’ substitution difficulty; and iii) ‘high’ assessment of the socio-economic, reputational and financial default implications in the event of a hypothetical default of Ferde.

The assessments under QS1 and QS2 result in an indicative rating of ‘aa+’. The supplementary analysis of stand-alone business and financial risks has not led to an adjustment of the indicative rating, resulting in a final rating of AA+.

The results were discussed and confirmed by a rating committee.

Environmental, social and governance (ESG) factors

Governance and social considerations are integral to Ferde’s credit quality and are incorporated into the rating through several analytical areas. Ferde's strong oversight by county owners, alignment with public transportation policies, and structured internal governance ensure prudent financial planning, controlled expenditures, and effective debt management to mitigate interest rate and refinancing risks.

Ferde plays a crucial role in enhancing regional connectivity and economic growth by financing roads that improve access and promote social cohesion. Ferde prioritises social responsibility through adherence to UN Global Compact principles, compliance with the Transparency Act, and continued reporting on sustainability despite the exception from the CSRD.

Environmentally, Ferde assesses and mitigates risks in its projects to ensure compliance with national regulations, underscoring its commitment to environmental stewardship and the sustainable development of infrastructure. This is evidenced by its Eco-Lighthouse recognition, recently updated green framework, and NOK 3.85bn in green financing through bonds and bank loans at end-June 2025 primarily supporting the Bergen Light Rail, part of project Bypakke Bergen.

1. While not officially allocated to Ferde’s portfolio yet, this project will be managed by the company given the location and established guarantee framework by Vestland, one of Ferde’s owners.

Rating committee
The main points discussed during the rating committee were: i) Ferde’s role as a regional Norwegian toll road operator and its integration with the owning counties; ii) control and regular support and likelihood of exceptional support; iii) business and financial risk profiles and; iv) peer comparison.

Methodology
The methodology used for these Credit Ratings and/or Outlooks, (Government Related Entity Rating Methodology, 3 September 2025), is available on scoperatings.com/governance-and-policies/rating-governance/methodologies.
Information on the meaning of each Credit Rating category, including definitions of default, recoveries, Outlooks and Under Review, can be viewed in ‘Rating Definitions – Credit Ratings, Ancillary and Other Services’, published on scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Historical default rates of the entities rated by Scope Ratings can be viewed in the Credit Rating performance report at scoperatings.com/governance-and-policies/regulatory/eu-regulation. Also refer to the central platform (CEREP) of the European Securities and Markets Authority (ESMA): registers.esma.europa.eu/cerep-publication. A comprehensive clarification of Scope Ratings’ definitions of default and Credit Rating notations can be found at scoperatings.com/governance-and-policies/rating-governance/definitions-and-scales. Guidance and information on how environmental, social or governance factors (ESG factors) are incorporated into the Credit Rating can be found in the respective sections of the methodologies or guidance documents provided on scoperatings.com/governance-and-policies/rating-governance/methodologies.
The Outlook indicates the most likely direction of the Credit Ratings if the Credit Ratings were to change within the next 12 to 18 months.

Solicitation, key sources and quality of information
The Rated Entity and/or its Related Third Parties participated in the Credit Rating process.
The following substantially material sources of information were used to prepare the Credit Ratings: public domain and the Rated Entity.
Scope Ratings considers the quality of information available to Scope Ratings on the Rated Entity or instrument to be satisfactory. The information and data supporting these Credit Ratings originate from sources Scope Ratings considers to be reliable and accurate. Scope Ratings does not, however, independently verify the reliability and accuracy of the information and data.
Prior to the issuance of the Credit Rating action, the Rated Entity was given the opportunity to review the Credit Ratings and Outlooks and the principal grounds on which the Credit Ratings and Outlooks are based. Following that review, the Credit Ratings and Outlooks were not amended before being issued.

Regulatory disclosures
These Credit Ratings and Outlooks is issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0. The Credit Ratings and Outlooks are UK-endorsed.
Lead analyst: Elena Klare, Analyst
Person responsible for approval of the Credit Ratings: Jakob Suwalski, Executive Director
The Credit Ratings/Outlooks assigned to the issuer were first released by Scope Ratings on 25 November 2024.
The Credit Ratings/Outlooks assigned to the instruments guaranteed by Rogaland were first released by Scope Ratings on 10 February 2025.
The Credit Ratings/Outlooks assigned to the instruments guaranteed by Vestland were first released by Scope Ratings on 3 March 2025.
The Credit Ratings/Outlooks assigned to the instruments related to the Ryfast project were first released by Scope Ratings on 6 June 2025.
The Credit Ratings/Outlooks assigned to the instruments guaranteed by Agder were first released by Scope Ratings on 6 June 2025.

Potential conflicts
See scoperatings.com under Governance & Policies/Regulatory for a list of potential conflicts of interest disclosures related to the issuance of Credit Ratings, as well as a list of Ancillary Services and certain non-Credit Rating Agency services provided to Rated Entities and/or Related Third Parties.

Conditions of use / exclusion of liability
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