OREANDA-NEWS. National Rating Agency has affirmed its national scale 'AA' credit rating on Interregional Distribution Grid Company of Center (IDGC of Center) OJSC.

The rating affirmation reflects the company's strong operating and financial performance, dominance in its home market, and the fact that its controlling stake is owned by the Russian state. The rating also recognizes the company's high equity level, strong equity-to total assets ratio, high financial strength, as well as above-market-average current and instant liquidity ratios. These factors combined with IDGC of Center's moderate debt burden and low funding costs warrant our positive assessment of the company's creditworthiness and credit strength.

The rating is constrained by the worsening of IDGC of Center's financial result for 2013, attributed to low-quality receivables that had accumulated in the balance sheet and required additions to the depreciation reserve. Despite heavy provisioning, the company's financial result remained positive. Moreover, in 2014, IDGC of Center has been doing a lot to reduce its past-due receivables and taking necessary steps to prevent their growth this year. This has already made a positive impact on the company's IFRS financials for 1Q 2014.