OREANDA-NEWS. On 24 February 2009 was Credit-Rating, a nationally recognized credit rating agency in Ukraine announced that it assigned a long-term counterparty credit rating of uaBB to Kiev Oblast-based Makariv Battery Farm LLC (`issuer ` or `company`) and its issue of registered coupon bonds (series A). The amount of the issue is UAH90m, with 5-year original maturity. The company`s principal activity is production of hen`s eggs. In the course of analysis Credit-Rating considered company`s financial statements for 2006-2007 and its other inside information.

An obligor or a debt liability with uaBB credit rating is characterized with the LOWER THAN SUFFICIENT creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is strongly affected by adverse changes in commercial, financial and economic conditions.

Factors maintaining the credit rating

The company is associated with Avangard group, which enables the company to secure full production and sale cycle.

Strong market positions of Avangard group, which incorporates the company.

The group`s net sales recorded in 2007 as compared with those in 2006 grew 7.8x to USD127.4m, with the EBITDA advanced 7.1x to USD40.7m; the EBITDA margin was recorded at 32%.

Factors constraining the credit rating

Debt burden of Avangard group (the group`s net debt 5.7x exceeded the EBITDA in 2007), with the major part of group`s property pledged as security for bank loans.

Company`s vulnerability to changes in state agricultural policy and growing competition in the egg sector.