OREANDA-NEWS  On 24 September was announced, that National Rating Agency (NRA) raised an individual solvency rating of IDGC of Centre, JSC up to "A+" level (high solvency, the first level). Deputy General Director for Economy and Finance of IDGC of Centre Evgeny Bronnikov, Financial Director of IDGC of Centre Vladislav Kapitonov, General Director of National Rating Agency Viktor Chetverikov took part in the video press conference dedicated to this event; top managers of companies and representatives of mass media were present in the studios of the company’s 11 branches. 

Deputy General Director for Economy and Finance of IDGC of Centre, JSC Evgeny Bronnikov in solemn atmosphere was presented with the certificate on assignment of a credit rating. The certificate was handed over by the General Director of National Rating Agency Viktor Chetverikov. 

"Revision of the rating in many respects is connected with the reform. Besides, in comparison with other companies, IDGC of Centre exercises all the undertaken credit and debt obligations in time and without loss of solvency and financial stability. Our all valuations and monitoring of companies' activities is aimed exclusively to develop the sector,” Viktor Nikolaevich emphasized.

Welcoming all the present, Evgeny Alekseevich noted that such meetings became a kind tradition for the company. "We with pleasure call you our partners," he addressed the NRA's representatives. "The methods you use for risk estimation take into account changes of the market conditions and specificity of our sector".

He reminded that in 2007 the National Rating Agency appropriated "A" solvency rating to IDGC of Centre, JSC (high solvency, the second level), and within a year the company not only could confirm its rating, but also raise it up to "A" level (high solvency, the first level).

"Improvement of the rating was caused by successful completion of the process of creation of the united operational company, improvement of corporate governance quality, and development of IDGC of Centre’s activities to increase openness," Viktor Chetverikov concluded.

Viktor Nikolaevich explained that the level of high solvency means ability of the company in full to exercise its credit and debt obligations without loss of solvency and financial stability. The enterprise possesses low risk of loss of solvency in case of debt increase concerning the existing obligations.

The parties unanimously agreed that IDGC of Centre, JSC according to the reform action plan successfully passed procedure of DGCs merging - shareholders of all 11 DGC by the qualified majority approved creation of the united operational company.

Now shares of IDGC of Centre, JSC are trading on the Russian exchanges. The company obtains credit from large Russian and foreign banks, such as "ROSBANK", "Gazprombank", "Raifeisenbank", "Bank of Moscow", "Orgresbank", and others.

A key point at the solvency rating improvement was achievement by the company in 2007 and 2008 of all target levels of financial indicators. Thus, activity of IDGC of Centre is profitable and is characterized by a high profitability level in view of average sector indicators.

The public Development Strategy of IDGC of Centre contributed a lot to the solvency rating improvement. Priority goals include implementation of RAB that is a new method of calculation of tariffs on the basis of profitability; increase of business transparency, quality of corporate management, the capital move to the international markets, implementation of modern information systems.

General Director of NRA said that values of financial parameters of the company are at a high level. They correspond to normative values of key financial indicators. Positive dynamics is observed in the structure of the company assets. The share of non-current assets was reduced to 75 %. Activity of IDGC of Centre is profitable, and it is characterized by the level of profitability of average sector indicators. IDGC of Centre draws up its reporting under the international financial reporting standards.

The results of the half of the year, and also plans and tasks of the company for the immediate prospects were presented by Deputy General Director for Economy and Finance Evgeny Bronnikov.

In particular, Evgeny Alekseevich emphasized that following the results of six months of 2008, IDGC of Centre received a profit (before taxes) of RUR 2,158,426 thousand, without taking into account write-off of debt receivable and illiquid commodities and materials in the 1st quarter. The amount of write-off was RUR 961,699 thousand. In comparison with the similar period of the last year, the profit (before taxed) grew by 19 %. Amount of the proceeds delivered by territorial grid organizations following the results of 6 months 2008 was RUR 3,083,069 thousand; and growth of the branches' own proceeds from transfer for half the year 2008 equaled 20 %.

In connection with growth of net profit generated by the company, increase in the amount of depreciation accrual at targeting extra means for financing the investment program, EBITDA (operational cash flow) 2.47 times increased within 01.01.2007 to 01.01.08; within 01.01.2008 to 01.07.2008 - 1.51 times increased. Total for the 01.01.2007 - 01.07.2008 period, the growth of EBITDA was +272 %. The Debt/EBITDA standard world ratio of no more than four was executed during the specified period.

Evgeny Alekseevich told those present about IDGC of Centre's implementation of the RAB tariff regulation system based on fair market profitability of the capital involved in branches. "Transition to the RAB-based tariff regulation system will economically contribute to raise reliability and efficiency of activities," Evgeny Alekseevich said. "Now Belgorodenergo and Tverenergo branches are the first-stage "pilots" concerning transition to the RAB system. And now we are choosing potential "pilots" of the 2nd stage".

Let us remind that the National Rating Agency is private and has been carrying out its activities on rating assignment to the financial market participants since 2000. Now over 800 Russian companies and banks have remote and individual ratings. The analysis is carried out on the basis of over 50 indicators quarterly and monthly. Experts of the agency have more than 10-year practical operational experience in the risk management system and analytical divisions of large companies and banks. Ratings of the investment companies, as one of the criteria, are applied at establishing limits on the RTS stock exchange at carrying out addressless trading.

"Assignment of this rating has an important strategic value for the company further development," Deputy General Director for Economy and Finance of IDGC of Centre summarized. "It will contribute to improvement of the investment appeal of the company, the level of trust on the part of shareholders, investors, and bank community. IDGC of Centre hopes for continuation of fruitful cooperation within the limits of maintenance and increase of the company's credit rating."