OREANDA-NEWS. January 14, 2010. Credit-Rating, a nationally recognized credit rating agency in Ukraine, has today announced that it downgraded to uaB from uaBB the long-term credit rating assigned to registered housing bonds (series A, B) issued by the Dnepropetrovsk-based Scientific and Manufacturing Association Sozidatel CJSC (‘issuer’ or ‘company’) for the amount of UAH80.2m. The rating’s outlook is stable. The company’s principal activity is rendering of services of industrial and residential construction, engineering and development. Today the company implements a number of investment and construction projects located in the city of Dnepropetrovsk. To revise the rating Credit-Rating considered issuer’s financial statements for 3Q2009 and 9M2009 and other inside information.

An obligor or a debt liability with uaB credit rating is characterized with the low creditworthiness as compared to other Ukrainian obligors or debt liabilities. This level of creditworthiness is extremely susceptible to adverse changes in commercial, financial and economic conditions.

Stable outlook indicates that there are no anticipated reasons to change the rating in the course of the year.

Factors maintaining the credit rating

the issuer has experience in carrying out the construction projects, in fact starting from 1994 the company has built or renovated around 40 buildings of over 250K sq.m. floor area.

the issuer owns production facilities and structural subdivisions, which empower it to supply the construction process on almost all stages.

high construction readiness of company’s projects, in fact that of the 3rd phase of construction of a residential building located D.Kedrina Str. (82% as at September 30, 2009) and of residential complex located in Topolina Str. (70% as at September 30, 2009).

Factors constraining the credit rating

low pace of works at the 3rd phase of construction of a residential building located D.Kedrina Str. and at residential complex located in Topolina Str, which will entail anticipated late redemption of series A and B bonds.

ongoing negative trends in Ukraine’s real estate sector.

instability in legislation and tax environment controlling both the construction industry and project financing.