OREANDA-NEWS. Credit-Rating, a nationally recognized credit rating agency in Ukraine has assigned UAH50m 5-year registered coupon bonds (B series) issued by Sumy-based Sumykhimprom OJSC a long-term credit rating of uaBBB- (uaBBB minus). In the course of analysis Credit-Rating considered the Issuer`s financial statements for 2003-2006 and 1H2007 as well as other inside information furnished by the company. An obligor or a debt liability with uaBBB credit rating is characterized with the SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is affected by adverse changes in commercial, financial and economic conditions. The plus (+) or minus (-) modifier denotes rating`s relative status within major categories.

Factors maintaining the rating
The Issuer is a strategic entity for the Ukrainian economy and one of the biggest CIS' producers of titanium dioxide, mineral fertilizers, colorants, fodder phosphates and coagulants. The specific gravity of the company in the national production of titanium dioxide accounts for 35 per cent, of sulfuric acid accounts for 30 per cent, of ammoniated superphosphate for 100 per cent, and of complex mineral fertilizers - for 50 per cent.
Issuer`s asset balance grew 29.3 per cent to UAH 800.8m in 2004-2006 and 1H2007, the company`s sales rose 75 per cent to UAH579.5m in 2003-2006, the EBITDA grew 46 per cent to UAH46.5m.

Factors constraining the rating
Issuer`s unstable performance in 2003-2006; among the factors causing it was company`s dependency upon environment in overseas markets, the assets` writing-off and their supplementary estimations, and losses incurred under company`s nonspecialized activity. According to the 2 past years` totals, Issuer`s profitability has fallen due to the rise in gas price and disproportional growth in general and financial expenses. The company`s debt burden has been rising in the past few years, in fact, the debt to equity ratio grew to 43.3 per cent as of Jun. 20, 2007, from 24.9 per cent as of Dec. 31, 2003, with such a tendency being expected to be retained and bolstered by a necessity in investments for the renovation of company`s production facilities. There is also uncertainty about company`s probable privatization.