IBI-Rating has upgraded the credit ratings of «Ukrzaliznytsia» JSC

IBI-Rating informs on affirming of the long-term credit rating of «Ukrzaliznytsia» JSC at uaBBВ- grade with outlook «in development».

According to the consolidated financial statements, compiled under IFRS, net income of «Ukrzaliznytsia» JSC according to the results by 9 months increased by 14.4% - amounted to UAH 61 252.1 million, as compared to the previous year. The result of the activity was net profit of UAH 0.2 million.

Due to the phased repayment of bank loans, liabilities of «Ukrzaliznytsia» JSC on borrowings are reduced. The sensitivity to currency risk is partially reduced by the presence of currency revenues from transit traffic and the launch of quasi-hedged instruments. Eurobond holders have been given consent to the exclusion from the terms of circulation of the cross-default clause on bank loans for which the restructuring process is ongoing.

«Ukrzaliznytsia» JSC is formed on the basis of the State Administration of Railway Transport, enterprises and institutions of public railway transport, which are reorganized by merger. «Ukrzaliznytsia» JSC is a natural monopolist on rail transport in the territory of Ukraine, which provides a stable cash flow from operating activities. At the same time, the Company depends on state regulation, first of all, setting tariffs for transportation. There is a need for significant investments in the renovation of rolling stock of «Ukrzaliznytsia» JSC, due to high wear and tear.

Materials used for conducting the analytical research were obtained from «Ukrzaliznytsia» JSC, including: financial statements for 2015-2017 and 9 months of 2018, reference information on the activities of «Ukrzaliznytsia» JSC, information on issues of interest-bearing bonds, other necessary internal information, as well as information from open sources, which the Rating Agency considers to be reliable.

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