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17.10.2007
Credit-Rating rates Miskbudinvest`s bond issue at uaBB-
Credit-Rating, a nationally recognized credit rating agency in Ukraine has today assigned UAH112.5m 7-year issue of registered discount bonds (F series) by Kiev-based Miskbudinvest Construction Company LLC (`Issuer` or `company`) a long-term credit rating of uaBB- (uaBB minus). The company`s principal activity is construction, wholesale trade of construction materials and broking in real estate market. Today the group of companies the Issuer incorporated with implements 10 investment and construction projects in the city of Kiev and borough of Sudak (Autonomous Republic of Crimea). In the course of analysis Credit-Rating considered Issuer`s financial statements for 2002-2006 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 is incorporated with the group of companies, which specializes in providing construction services as a general contractor and a contractor and in construction financing; in fact the group participated in implementation of 5 projects, namely on cottage village building and another 4 homebuilding projects of 35K sq.m.
- The Issuer is engaged in construction in the city of Kiev, where real estate prices have been growing over the past few years.
Factors maintaining the credit rating
- Issuer`s dependency upon its liabilities, which exceed 735x Issuer`s equity as of June 30, 2007.
- Issuer`s volatile performance in 2002-2006 and 1H2007, among other factors entailed by company`s securities operations.
- Issuer`s performance within the group imposes risks of redistribution of cash flows within the group neglecting Issuer`s interests and makes it vulnerable to risks of the whole group.
- 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
