OREANDA-NEWS. May 16, 2011. Novorossiysk Commercial Sea Port Group (LSE: NCSP, RTS & MICEX: NMTP) hereby announces that international rating agency Moody's has revised NCSP’s corporate rating and its Eurobond issue rating.

Moody’s Investors Service has downgraded to Ba3/Aa3.ru from Ba1/Aa1.ru the corporate family rating (CFR) and probability of default rating (PDR) of PJSC Novorossiysk Commercial Seaport (“NCSP”). Moody’s has also downgraded the USD300 million worth of 7% loan participation notes due in 2012 issued by Novorossiysk Port Capital S.A. (the “Loan Participation Notes”) to B1/Loss Given Default assessment of LGD4 from Ba1/LGD4. The rating outlook is stable.

The stable outlook on the ratings reflects Moody’s expectation that: “(i) NCSP will see continued growth in its business; (ii) the company’s capex programmes are appropriate for the expected growth; and (iii) cash flows generated will enable NCSP to deleverage in terms of debt/EBITDA, thereby allowing the company to meet its debt maturities on a timely basis and comply with the financial covenants of the Sberbank loan”.

According to Moody’s, “the USD2.15 billion acquisition of PTP, mostly financed by the Sberbank Loan, has increased NCSP’s indebtedness significantly. PTP is Russia’s largest crude oil exporting port, and with the recent addition of capacity to handle oil products, would be expected to generate good cash flow over the coming years. The seven-year tenor of the Sberbank Loan suggests that a fairly rapid pay-down of the debt is possible”.