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06.03.2006
“uaBBB” credit rating assigned to upcoming bond issue of Unimilk Ltd
Today independent rating agency Credit-Rating announced the granting of a long-term "uaBBB" credit rating to the scheduled registered interest-bearing bond issue (A, B series) by Unimilk, Ltd (Kyiv) in the amount of UAH 30 million with a circulation period of 3 years. The main trend of the company’s activity is sales of dairy products and other foods, commercial activity through the network of the company stores and other stores.
Factors supporting the credit rating’s level:
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Unimilk, Ltd is a member of Unimilk Ukraine Holding, the main operator of Ukrainian milk and dairy products market: the market share of the holding is 14%;
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Bonds are provided with the guarantee of OJSC Galakton, the main enterprise of the holding (as of 01.01.2006 balance currency – UAH 142 million, financial result – UAH 2 million);
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Certain showings by Unimilk Ukraine holding improved in 2005: operating income – 17% to UAH 66.7 million, net income – 22 times to UAH 14.4 million, EBITDA – 67% to UAH 39.6 million;
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The holding operates in the market where annual growth rates are expected to amount to 10-12% in 5 next years;
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The holding’s enterprises are capable of increasing production: according to the results of 2005 the capacity utilization was 55-57%;
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Positive experience of bond issuance and service by holding’s enterprise – affiliate company OJSC Galakton Galaktis.
Factors restricting the credit rating’s level:
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Unimilk, Ltd was created only in October 2005 which complicates analysis of its activity;
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Debt of Unimilk Ukraine to banking institutions at the beginning of 2006 is UAH 85.5 million, 50.3 million of which are plain debt of OJSC Galakton while it provides guaranty for obligations in the sum of UAH 23.3 million;
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Intense competition in the dairy products market especially in the segment of high marginal products; expansion in this segment is one of the key points in the holding’s development strategy;
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The industry’s high sensitivity to fluctuations of prices on milk due to production seasonality; great administrative regulation of the industry.
Should you need more detailed information, please contact us.
Kyiv (+38044 490 25 50, fax +38044 490 25 54)
