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05.07.2007
Bond issue by Shuvar LLC assigned uaB- credit rating
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaB- (uaB minus) long-term credit rating to UAH20m 10-year issue of registered coupon bonds by Lviv-based Shuvar LLC (`Issuer` or `company`). The company`s principal activity is construction and exploitation of markets, of trade complexes, organizing the industrial and non-industrial goods trade, and rendering services (exploitation and renting the commercial premises). In the course of analysis Credit-Rating considered Issuer`s financial statements for 2002-2006 and 1Q2007 as well as other inside information furnished by the company.
A credit rating of uaB is a speculative grade rating, indicating a debt liability that has a HIGHER DEFAULT POSSIBILITY on the payment of principal and interest than a uaBB rating. This rating indicates that adverse changes in the business, financial or economic conditions in the Ukrainian financial market environment may negatively affect the obligor`s capacity and willingness to meet in full its commitments on the given debt liability. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.
Factors maintaining the credit rating
- Issuer`s key indicators have grown over 2003-2006, specifically the company`s assets grew 11.1x to UAH63.3m, the net sales grew 5.6x to UAH12m, the net sales grew 5.4x to UAH2.6m. This was caused by significant increase in premises rented by the Issuer.
- Issuer`s high profitability and financial strength indicators, specifically 2006 saw 21% of sales profitability, the EBITDA amounted to 47%, with the financial independence ratio making up for 0.73 as of March 31, 2007.
Factors constraining the credit rating
- Low Issuer`s liquidity and negative working capital, called forth by Issuer`s specific character of activity construction and renting the commercial premises.
- The scheduled issue parameters (the 10-year original maturity with 0.05% of annual interest) do not correspond with the commonly-accepted parameters of coupon bond issues.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may be found 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
