print
15.06.2007
Korovai company assigned uaBBB- credit rating
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaBBB- (uaBBB minus) long-term credit rating to Lugansk-based Korovai OJSC (issuer or company). The primary companys activity is production and sale of baked goods mainly in Lugansk region. In the course of analysis Credit-Rating used Issuers financial statements for 2002-2006 as well as other inside information furnished by the company.
The uaBBB issuer rating reflects obligors adequate capacity to timely and in full meet its commitments on the obligations in the Ukrainian financial market environment. There is, though, a higher vulnerability to the effect of adverse changes in business, financial and economic conditions as compared to obligors with higher ratings.
The plus (+) or minus (-) modifier denotes ratings relative status within major categories.
Factors maintaining the credit rating
- The company has a 12-year experience on baked goods market of Ukraine, incorporating 8 bakery factories, with their production facilities allowing the company for being a monopolist on Lugansk region market.
- The companys assets have grown 31.4% to UAH143.6m during 2003-2006 entailed by companys financial strength indicators, specifically the companys asset/equity ratio amounted to 0.54 as of Dec. 31, 2006, with the debt to equity ratio having amounted to 5.3
Factors constraining the credit rating
- Decline in companys output during the past 3 years from 106.5K metric tons in 2003 to 83.8K metric tons in 2006.
- Companys volatile performance during 2004-2006, the decreased liquidity and negative operating stock as of Dec. 31, 2006.
- Companys sensitivity to market conditions, which are dependant upon state policy in bakery industry and climate and weather conditions.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found at in the REUTERS, BLOOMBERG and FTN MONITOR information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
