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05.10.2007
Credit-Rating assigns Business-Grand`s bonds uaBB credit rating
Credit-Rating, a nationally recognized credit rating agency In Ukraine has today assigned UAH40m 5-year issue of registered coupon bonds (D-F series) by Cherkassy-based Business-Grand Private Company (`Issuer` or `company`) a long-term credit rating of uaBB. The company`s primary activity is wholesale and retail trade of alcohol and alcohol-free beverages, of foodstuff and beer. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2001-2006 and 1H2007 as well as other inside information furnished by the company.
An obligor or a debt liability with uaBB credit rating is characterized with the LOWER THAN SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is strongly affected by adverse changes in commercial, financial and economic conditions.
Factors maintaining the credit rating
- At the expense of the funds raised from the bond issuance the company plans to construct store and logistics centres, the demand for which twice exceeds the supply with such a tendency expected to be retained; the Issuer has experience in construction of two trade centres and of two office and storage complexes of 13.3K sq.m. total floor area.
- Issuer`s key figures have grown in 2004-2006, namely the assets grew 3x to UAH102.5m with the net sales rising 1.8x to UAH173.1m
Factors constraining the credit rating
- The issue will increase company`s debt burden, in fact the annual coupon payments will amount to UAH6.4m, which is 83.4 per cent of Issuer`s 2006 EBITDA.
- Growing competition on alcohol market the Issuer derives primarily revenues from.
Information on all credit ratings assigned in accordance with the Ukrainian national scale may be found in 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
