Fitch Ratings Affirms VolgaTelecom Rating at “AA-”; Outlook “Stable”
OREANDA-NEWS. On 22 May 2009 was announced, that Fitch Ratings had affirmed OJSC VolgaTelecom’s Long-term Issuer Default rating at “BB-“, Short-term IDR at “B”, National Long-term rating at “A+(rus)” and National Senior Unsecured at “A+(rus)”. The outlooks for the Long-term IDR and National Long-term rating are “Stable”.
Nikolai Lukashevich, a Senior Director with Fitch’s TMT team notes that “VolgaTelecom’s operating and financial performance is likely to remain stable in the downturn”. The report also states that “the management’s commitment to severely curtail Capex and run tight Opex should support margins and boost free cash flow generation to an extent that most scheduled debt repayments can be financed from internally generated cash flows”. Strong Q 1-2009 results by the Russian Accounting Standards suggest that the management is on track with its plans to improve operating cash flow and deleverage by end-2009.
“VolgaTelecom continues to be the most profitable and one of the least leveraged Russian incumbent operators. The Company has virtually no exposure to foreign currency risks with most of its debt denominated in roubles” – states Fitch report.
The ratings also take into account VolgaTelecom’s position of an established fixed-line incumbent telecoms company. The Company controls most of the last-mile and backbone infrastructure in its area of operations, which provides it with significant competitive and cost advantages. VolgaTelecom’s market shares are strong in all key traditional segments with competitive threats primarily driven by a longer-term trend of F2M substitution.
Fitch also notes that “VolgaTelecom’s leverage is modest for its rating category and is declining”.
Комментарии