RTI OJSC’s Credit Rating Affirmed At ‘AA-’; Outlook Revised To Stable From Positive
The Positive outlook materialization prerequisites have not been fully met at the date of the rating update. That is why NRA believes that it can consider the rating outlook revision to Positive, and that this outlook may be materialized if: the Group’s growth pace and the its key business lines’ profitability maintain at least at the current level; the Group’s debt remains manageable; and if the Group breaks even in terms of net income.
The rating affirmation reflects RTI’s position as a key player in its niche markets, considerablecompetitive strengths, strategic importance, active participation in the government’s high-tech projects and consistently filled up order portfolio. RTI’s strong corporate governance practices and transparency, the management’s focus on business process streamlining and the high quality of corporate and financial control, mitigating internal and external risks, are additional rating strengths. In addition, NRA noted the projected separation of the Information and Communication function that should improve the Group’s key performance metrics, such as profitability, capital adequacy ratio, etc.
The rating is constrained by the Group’s inadequate equity and exposure to currency risks that affect its financial performance and the capital adequacy ratio. The rating is also pressured to some extent by the absence of the Group’s audited 2014 financials, which, however, is due to reasons beyond the Group’s control (the Group plans to prepare audited financials for 2015).
NRA’s analytical products, including ratings and the contents of this press release, are statements of NRA’s independent opinion as of the date they are expressed and not statements of fact or recommendations to make any investment decisions or conduct any stock market transactions. NRA is not responsible for any results obtained from the use of opinions and/or information contained in this press release.
While NRA has obtained information from sources it believes to be reliable, NRA does not guarantee that this information is perfectly correct, complete and accurate, as it does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.