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17.10.2006
The planned bond issue of the LLC «Rovex» assigned uaBB+ (uaBB plus) credit rating
The independent «Credit Rating» agency has today announced the assignment of the uaBB+ (uaBB plus) long-term credit rating to the issue of registered interest-bearing bonds (A series) by the Ternopil’-based LLC «Rovex» for the amount of UAH 5 mln. with the 4 year maturity term. The main company’s activities are wholesale and retail trade of both foodstuff and nonfoods, as well as of alcoholic beverages and tobacco products. The «Credit Rating» agency used the Issuer’s financial reports for 2003 - 1Q2006 , and other inside information, furnished by the company.
The debt liabilities rated uaBB are the least affected by the risk of nonpayment of the principal or interest within the speculative grade. The obligor, however, may face difficulties connected with full and timely payment in the Ukrainian financial market environment in the event of adverse changes in business, financial and economic conditions. The possibility of nonpayment is low in the near future. The "plus" denotes the relative rating’s status within major categories.
Factors supporting the credit rating level
- The Issuer is one of the leading wholesale and retail foodstuff and nonfoods trader in the Ternopil’ region. The Issuer also operate 2 shops of the «Torgoviy mir» network, which overall accounts for 15 supermarkets.
- The LLC «Rovex» is incorporated into a specialized group of companies, which provides the company with the favorable rent and purchase conditions.
- The Issuer’s financial and economic activity growth over the past 3 years and over 1Q2006, in fact the company’s assets rose 3x, namely to UAH 59.4 mln. as of 1st April 2006, the financial independence ratio rose from 0.07% to 0.1%, the liquidity indices has a positive dynamics being on sufficient level.
- The company’s equity capital (UAH 9.9 mln.) 1.7x exceeds the size of the issue planned (UAH 6.0 mln.) as of March 31, 2006.
- The non-satiety of the western regions’ market, which contributes to the high rates of the retail turnover (121.3% in 2005 in Ternopil’ region).
Factors restricting the credit rating level
- The risks of cash flows’ and main funds’ redistribution within the group of companies without taking into account the Issuer’s position.
- The Issuer’s 2006-2010 development strategy envisages a significant increase of debt burden.
- The competition growth on the Ukrainian retail trade market and in particular in western regions.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale can be found in the REUTERS and BLOOMBERG information systems.
For further information, please contact:
Information and analytic department
Sergey Rozumyak +38 044 490 25 50
SRozumyak@credit-rating.com.ua
