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22.05.2007
Bond issue by Insakharprom-K assigned uaBBB- credit rating
Credit-Rating, a nationally-recognized credit rating agency in Ukraine has today announced the assignment of the uaBBB- (uaBBB minus) long-term credit rating to issue of registered coupon bonds (A series) by Odessa-based Insakharprom-K LLC (Issuer or company) for the amount of UAH 50m wit the 3-year original maturity. The main companys activity is wholesale and retail trade of white sugar and of its co-products. In the course of analysis Credit-Rating used Insakharprom-K groups and Issuers financial statements for 2002-2006 as well as other inside information furnished by the company.
The uaBBB issue rating reflects Issuers adequate capacity to timely and in full meet its commitments on the obligation in the Ukrainian financial market environment. This obligation is more vulnerable to adverse changes in commercial, financial and economic conditions as compared to debt obligations with higher ratings. The + and - modifiers denote ratings relative status within major categories.
Factors maintaining the credit rating
- The Issuer is a managing company of Insakharprom-K group (group), which is involved in sugar-production operating own three sugar plants. According to 2006-2007 results the group takes 7th place by volumes of sugar produced with its market share amounted to 2.8%.
- The volumes of the sugar produced grew 2x (to 74K metric tons) according to 2006-2007 totals as compared to the previous years. The stock amounted to 43.5K tons by 2007 year-beginning.
- The groups management structure allows for skillful managing the groups companies in the framework of strategic tasks stated by the shareholders board.
- The upcoming bond issue is underwritten by sugar plant Agropromyshlenyi kompleks Pivdennyi OJSC, which is incorporated with the group. Its sales of the sugar produced in 2004-2006 grew to UAH 37.8m from 29.8m, the EBITDA grew to UAH 3.6m from 2m.
Factors constraining the credit rating
- Unstable indicators of Issuers performance over its period of operation, stipulated by its seasonality and susceptibility to the state of agricultural complex, to cropability and support from the state.
- The Issuer is not supplied with the own-grown sugar beets, making the group dependant upon farming companies and their ability to gain adequate crops.
Information on all credit rating assigned in accordance with the 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
