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20.11.2007
Credit-Rating: Slavutych`s bond issue rated uaBB
Credit-Rating, a nationally recognized credit rating agency in Ukraine has today assigned a long-term credit rating of uaBB to UAH48.4m 2-year registered housing bonds (A series) issued by Dnepropetrovsk Oblast-based SK Slavutych LLC (`Issuer` or `company`). The company`s primary activity is investing and construction. Today the company as a customer and investor implements 5 projects on construction of residential and non-residential buildings in the cities of Dnepropetrovsk and Lugansk. 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.
Factors maintaining the credit rating
- The Issuer is incorporated with the group, which companies have implemented two projects on construction of 20.3K sq.m. of residential premises in the city of Dnepropetrovsk.
- The Issuer is engaged with organizing and financing of construction in the city of Dnepropetrovsk, where real estate prices and demand have been growing over the past few years.
Factors constraining the credit rating
- The issue size of UAH48.4m exceeds 55.6 per cent the Issuer`s assets of UAH31.1m as of Jun.30, 2007.
- Issuer`s detrimental performance in the period under analysis (excluding 2006): the company`s uncovered loss accounted for UAH2.8m as of Jun. 30, 2007.
- The Issuer does not have experience in redemption of housing bonds.
- The bond issue is to be redeemed by premises in the residential complex, the proprietary rights for which are deposited under a bank loan.
- Instability in legislation and tax environment controlling both the construction industry and project financing.
Information on all credit ratings assigned in accordance with the National Scale may be found in REUTERS, BLOOMBERG and FTN MONITOR information systems.
For more information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
