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Press Releases / 09.04.2013
Press Release as of 09.04.2013 MOBITEL LLC CJSC AK&M Rating Agency affirmed the ‘A’ credit rating (stable outlook) assigned to MOBITEL LLC as per the national scale. The ‘A’ rating indicates a high credit standing of the Company. Risk of a delay in meeting liabilities is relatively low, restructuring risk for a loan / part of a loan is minimal. The key argument in favor of the rating of MOBITEL LLC (hereinafter also referred to as the ‘Company’ or ‘Entity’) is still the high financial capacity of its parent company OJSC Rostelecom (long-distance and international electric communication company) proven by the credit ratings assigned by the leading international rating agencies. OJSC Rostelecom, Russia’s largest national telecommunications group providing services in all the telecom sub-sectors, owns 99.99% of MOBITEL’s authorized capital),. In 2012, MOBITEL LLC pursued a targeted investment policy of increasing its assets, mainly purchasing the shares of its parent company. Besides, the Company acquired 50% (effective stake being 100%) of the shares in cellular operator CJSC SkyLink under an exchange agreement with OJSC Svyazinvest, as part of Rostelecom Group’s strategic development program. As of 12/31/2012, the Company’s assets amounted to RUB 28.9 billion (+56% against the start of the year), securities accounting for 99% of the assets. As of the same date, CAR was 43.9% indicating high financial stability of the Entity. Pursuant to its investment policy, MOBITEL LLC borrows capital. VTB Bank, Gazprombank, and Rostelecom are its principal lenders. As of 12/31/2012, the debt burden on the company was acceptable, debt to net assets ratio being 0.58, debt to investment ratio being 0.26. Short-term loans accounted for no more than 50% of the total amount of debt. The income from the Company’s financial investments was one of the sources of funds to meet its current obligations (interest payments). The Company posted a net loss of RUB 5.89 billion for the last accounting year (against a net profit of RUB 3.70 billion in 2011). This technically negative result was mainly due to the revaluation of financial assets proceeding from the current market value of the securities held by the Entity. At the same time, the relative price stability of OJSC Rostelecom’s stock (accounting for 67% of MOBITEL’s security portfolio) throughout the first quarter 2013 implies a probably better income position in the short-term and medium-term prospects. Nevertheless, the macroeconomic fluctuations and ensuing instability in financial markets remain the key risks for the Company. A possible decline in OJSC Rostelecom’s stock price and the lack of certainty as to the value of the stake in CJSC SkyLink may exert considerable pressure on the Company’s credit standing. Another risk factor is the strong dependence of incoming cash flows (except for credits and loans) on the parent company’s financial performance. However, the forthcoming merger of OJSC Rostelecom and OJSC Svyazinvest into a company where the state will retain a controlling stake is likely to increase the merged company’s financial capacity and investment appeal, providing additional support to the rating of MOBITEL LLC. MOBITEL LLC was established in 2010 by NPP Telecomcenter. In 2011, OJSC Rostelecom acquired 99.99% of the Entity’s authorized capital. As of 12/31/2012, the Company’s assets totaled RUB 28.87 billion, equity capital amounted to RUB 12.67 billion. MOBITEL LLC holds 4.64% of common shares and 12.55% of preferred shares in OJSC Rostelecom (5.24% of Rostelecom’s authorized capital). The Company’s auditor is Rosexpertiza LLC (a member of the self-regulatory audit organization NPP Russian College of Auditors).
This press release is based on the statement of assigning a credit quality rating to MOBITEL LLC. The credit rating, along with any information and conclusions provided in this press release, only conveys our opinion on the Company’s credit standing and shall not be considered as advice on the purchase and sale of securities or the provision of loan facilities. CJSC AK&M Rating Agency will not incur any responsibility for any interpretations, inferences and consequences related to the application of results of the rating estimation procedure by any third parties. CJSC AK&M Rating Agency is a leading independent national rating agency engaged in rating activities since 1993. CJSC AK&M Rating Agency is accredited by the Ministry of Finance of the Russian Federation (order no. 452 as of September 17, 2010). AK&M Ratings are recognized by the Central Bank of Russia (for providing unsecured lending facilities – Regulation 323-P), Vnesheconombank (for granting subordinated loans) and SME Bank (for its program of lending to SME businesses), RUSNANO (when selecting banks to provide cash and settlement services to project and engineering companies implementing investment projects), and the MICEX (as a prerequisite for including bonds in the Corporate Bond Index / MICEX CBI and Municipal Bond Index / MICEX MBI calculation base and for listing bonds). By a resolution of Russia’s GovernmentAK&M Ratings count for the recapitalization of banks. Besides, AK&M Rating Agency is recognized by AHML and accredited by SRO National Securities Market Association. CJSC Analysis, Consulting and Marketing Rating Agency |
