IBI-Rating has affirmed the credit rating of the bonds of «EURASIA SERVICE» LLC at uaBBB grade

IBI-Rating informs on the affirming of the long-term credit rating of interest A series bonds of «EURASIA-SERVICE» LLC at uaBBB grade with a «stable» outlook. The bonds with a par value of UAH 50 mln. were issued with maturity in 2023 to finance the purchase of mineral fertilizers and crop protection agents, as well as for payment of agricultural services.

«EURASIA-SERVICE» LLC is a part of «Svarog West Group» one of the leading performance of crop agro-industrial corporation. The land bank amounts to 80 thousand ha, the main crops are cereals, legumes and sugar beet. During the rating process IBI-Rating agency took into account «EURASIA-SERVICE» LLC’s is forming as part of «Svarog West Group», however, the credit rating of the bonds was updated based on the Issuer’s creditworthiness (excluding consolidated financial indicators).

The area of arable agricultural land of «EURASIA-SERVICE» LLC in Khmelnitsky oblast is 2.74 thousand ha. The activities of the Issuer, like other agricultural enterprises, are seasonal and sensitive to the impact of natural and climatic conditions.

Net income of «EURASIA-SERVICE» LLC of 2017, compared to the same period of the previous year, decreased by 31.8% and amounted to UAH 73,193 thousand. The result of activity for 2017 was net profit of UAH 10,854 thousand. According to the results for 3 months of 2018, the net income of the Issuer was amounted to UAH 278 thousand, against UAH 3,565 thousand for the same period of the previous year. The activity of «EURASIA-SERVICE» LLC based on the results for 3 months of 2018 was unprofitable, while the volume of net loss decreased, in comparison with the 1Q of 2017, by 20.5% and amounted to UAH 3,857 thousand. The losses of activity was due to a significant amount of financial expenses for the placed bonds. The Issuer's debt is formed solely by obligations on interest-bearing bonds. Taking into account the long-term nature of the debt obligations (bond redemption in 2023, and the possibility of presentation for early repurchase is not provided), the level of the debt load is estimated as moderate.

In order to carry out the analytical research the materials obtained from «EURASIA-SERVICE» LLC have been used, including: the annual financial statements for 2015-2017 and 3 months of 2018, parameters of the A Series bond issue, other necessary internal information, as well as the information from the public sources, which the Rating agency considers reliable.

Corporate department

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