IBI-Rating has updated the credit ratings of «Ukrtelecom» PJSC and its issue of interest-bearing bonds

IBI-Rating informs on updating of the long-term credit ratings of «Ukrtelecom» PJSC and its issue of interest-bearing T-V series bonds, according to which the credit ratings are affirmed at uaBBB grade, while the outlook is changed from «negative» to «in development», which indicates the probability of change credit ratings during the year. Credit ratings are kept in the Credit Watch List, where are listed the ratings which can be revised in the short term.

There is still uncertainty regarding the future activities of «Ukrtelecom» PJSC, related to the possibility of its return to state ownership, as well as the arrest of shares (due to default of debt by its majority shareholder). In addition, «Ukrtelecom» PJSC is party to litigation, the outcome of which may significantly affect in its financial condition.

Net income of «Ukrtelecom» PJSC by results of 9 months 2017 was amounted UAH 4,627.7 mln (-3%, in comparison with the same period of the previous year). The result of the activity was net profit of UAH 638.5 mln which is by 2.6 times more than in 9 months of 2016 year. According to the results of the analyzed period, most indicators of «Ukrtelecom» PJSC are at the highest level for the last few years and estimated as high. The Issuer hold a sufficiently high share of equity in the general structure of sources of financing activities. The attraction of new loans causes a gradual increase in the level of debt burden.

«Ukrtelecom» PJSC remains the largest operator of telecommunications services in the Ukraine. The Company provides a wide range of services for households and businesses, including: local (urban and rural), long distance and international telephone services, 3-G mobile communication services, computer communication services (including Internet access), telegraph communication and wire broadcasting services, as well as services of providing telecommunications channels for use. The Issuer holds leading positions in the fixed line market and broadband Internet access, which are provided by its own powerful transport telecommunications network, covering all regions of the country. Also, prospects of the telecommunication services market cause intensified competition. There is a decline in demand for fixed line services and its gradual replacement by mobile communication services, which corresponds to the global trend.

In order to conduct the analytical research the materials provided by «Ukrtelecom» PJSC have been used, including: the annual financial statements for 2014-2016 and 9 months of 2017, background information on activities of «Ukrtelecom» PJSC, information on the issue of bonds, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.

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