IBI-Rating has affimed the credit rating of bonds of «AGROFIRMA «ORSHIVSKA» LLC

IBI-Rating informs on the affirming of the long-term credit rating of interest A series bonds of «AGROFIRMA «ORSHIVSKA» LLC at uaBBB grade with a «stable». The bonds with a par value of UAH 100 mln. were issued to finance the purchase of crop protection agents, mineral fertilizers, seeds, as well as for payment of agricultural services.

«AGROFIRMA «ORSHIVSKA» LLC is a part of «Svarog West Group» one of the leading effectiveness of crop agro-industrial corporation. The land bank of the corporation amounted to 80 thousand ha, the main crops are cereals, legumes and sugar beet. During the rating process IBI-Rating agency took into account «AGROFIRMA «ORSHIVSKA» LLC’s is forming as 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 lands of «AGROFIRMA «ORSHIVSKA» LLC in Chernivtsi oblast is 4.05 thousand ha. The activities of the Issuer, like other agricultural enterprises, are seasonal and sensitive to the impact of natural and climatic conditions.

According to the results of 2017 «AGROFIRMA «ORSHIVSKA» LLC received UAH 175 065 thousand of net income, which by 2.3 times more than in the previous year, the result of the activity was net profit of UAH 7,991 thousand. Net income for 3 months of 2018 amounted to UAH 7,310 thousand, which by 17.1% less comparison with the same period of the previous year. The financial result from operating activity for the first quarter of 2018 did not cover the financial expenses of the period, which led to a loss of operations - a net loss amounted to UAH 417 thousand. Considering the long-term nature of a significant part of the debt (the terms of bond issue do not provide for an opportunity to be presented for early redemption), the level of the debt burden of the Issuer is assessed as acceptable.

In order to carry out the analytical research the materials obtained from «AGROFIRMA «ORSHIVSKA» LLC have been used, including: the annual financial statements for 2015-2017 and 3 months 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.

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