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08.10.2007
Credit-Rating assigns OLIMPEKS TRANS`s upcoming issue at uaBB+
Credit-Rating, a nationally recognized credit rating agency in Ukraine has today assigned UAH105m 1 ½-year issue of registered housing bonds (A-C series) by Odessa-based OLIMPEKS TRANS LLC a long-term credit rating of uaBB+ (uaBB plus). The company`s primary activity is investment and construction. Today the company constructs a residential and recreational complex in the city of Odessa. In the course of analysis Credit-Rating considered Issuer`s financial statements for 2003-2006 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. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.
Factors maintaining the credit rating
- The Issuer was established by the companies incorporated with HANNER group of companies that is the leader in construction industry of Lithuania having built 9 objects of over 200K sq.m., and by the companies incorporated with BEREG-GRUPP group of companies, which focuses on construction in Odessa and Mykolayiv Oblasts; this group has built 6 objects of over 70K sq.m.
- The planned issue is to be redeemed by premises in the recreational and residential complex in 3, 5, 7, V.Ibnera str. (1 st stage) in Odessa, which construction readiness made up 18 per cent as of Sep. 1, 2007.
- The Issuer constructs the complex in Odessa city centre, where real estate demand remains stably high.
Factors constraining the credit rating
- Issuer`s meeting its commitments on the liability with deadline on May 2, 2009 is contingent upon on-time unveiling of the complex scheduled for April 2009.
- The Issuer`s does not have experience in bonds redemption.
- Issuer`s dependency upon HANNER and BEREG-GRUPP groups of companies, which risks are common with those of the Issuer.
- Issuer`s negative equity as of Jan. 1, 2007 and Jul.1, 2007 entailed by its detrimental performance in 2003-2006 and 1H2007.
- The issue size of UAH105m exceeds 2.2x Issuer`s assets of UAH47.2m as of Jul. 1, 2007.
- Instability in legislation and tax environment controlling both the construction industry and project financing.
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
