RAEX (Expert RA) Confirmed the Rating of Obuv Rossii at the Level of ruBBB+


The rating agency of RAEX (Expert РА) confirmed the rating of credit capacity of Obuv Rossii Group at the level of ruBВB+. The rating forecast is stable. The rating analysis was performed on the basis of consolidated IFRS reports of Obuv Rossii Group.

The agency did not change the assessments of business risks of the Company. The main factor that underlay the decision of the agency to confirm the rating was the high diversification of end buyers and the absence of strong dependence on individual suppliers. In addition, the agency pointed out the high level of the Company capital adequacy among the positive factors of the rating.

"The fact that the rating of credit capacity remains at the same level confirms that the selected financial strategy of the Company is right. Our Company is actively increasing its retail chain and business volume. We use a wide range of instruments, including share capital, to finance our development. In October 2017, the Group performed an IPO at the Moscow Exchange, we reached a qualitatively new level of development and received new opportunities of long-term financing of our investment programs," comments Director of Obuv Rossii Group Anton Titov.

The high level of the Company capital adequacy also exerts a positive impact on the rating (0.61), which is expressed in the high level of "stress" liquidity. The "stress" liquidity is calculated as a ratio of the corrected assets to the total amount of the Company's liabilities, which is 1.9 as of the reporting date.

The agency notes that till the end of 2018 the Company has a quite comfortable debt burden repayment schedule and the EBITDA interest coverage level, and the repayment of 72% of the total debt with account of offers on the bonds falls on 2019. On the basis of the past stable actions of the Company related to the re-financing of the credit portfolio during the period of drop in demand on the footwear market (2014-2016), the agency proceeds from the premise of sufficiency of sources to re-finance the debt in 2019 (at the top of the market) and expects the availability of these substituting liquidity limits at the end of 2018.

The credit rating of Obuv Rossii LLC was first published on 25 September 2008. The previous rating press release for this rating object was published on 18 December 2017. The credit rating was assigned on the basis of the Russian national scale and is a long-term rating. A review of the credit rating and its forecast is expected not later than a year of the date this press release is issued.

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