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22.03.2007
Bond issue by «Tchernomorgidrostroy» assigned uaBBB credit rating
"Credit-Rating", a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaBBB long-term credit rating to the issue of registered discount bonds (A series) by Odessa-based "Tchernomorgidrostroy" OJSC ("the Issuer" or "the company") for the amount of UAH 8m due on 4 Jul. 2016. The main company`s activity is construction and reconstruction of sea and river ports, of shipbuilding factories and dockyards and of other manufacturing facilities; construction of levees and conduction of anti-landslide activities; civil, residential and social construction. In the course of analysis the agency used Issuer`s financial statements for 2002-2005 and 9M2006 as well as other inside information furnished by the company.
The uaBBB issue rating reflects obligor`s adequate capacity to timely and in full meet its commitments on the obligations in the Ukrainian financial market environment. There is, though, a higher vulnerability to the effect of adverse changes in business, financial and economic conditions as compared to obligors with higher ratings.
Factors maintaining the credit rating
- The Issuer has operated since 1945 and is the leading company in Odessa in industrial and residential construction. The company as a general contractor has provided services for UAH 392.8m, and constructed a number of port facilities and 11 residential buildings.
- The Issuer owns production facilities and structural subdivisions for supplying the construction process on almost all stages and for partial providing the construction with own-made construction materials.
- The planned issue size (UAH 8m) amounts to 2/3 of the Issuer`s undistributed profit (UAH 11.6m) as of 30 Sep. 2006.
- High-proficient Issuer`s management, having great experience in construction and in the industry overall.
- The Issuer is involved in construction in the city of Odessa, where real estate prices and demand have been growing over the past few years.
Factors constraining the credit rating
- Unstable Issuer`s performance over 2002-9M2006 along with its detrimental activity in 2002 and 2004.
- Issuer`s dependency on size of projects and on order portfolio, which are constrained by growing competition on the construction market.
- Volatility in legislation and taxation on operations connected with construction and with attraction of funding.
Information on all the credit ratings assigned in accordance with the Ukrainian national scale may 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
