S&P affirms Vimpelcom's ratings at "BB," outlook changed to stable
LONDON. Jan 27 (Interfax) - The international ratings agency Standard & Poor's has affirmed the long-term ratings in foreign and national currency of the Russian communications operator Vimpelcom at "BB," and outlook has been changed to stable from positive, the agency said in a press release.
S&P also affirmed the "'BB" issue and "3" recovery ratings on Vimpelcom's debt and the debt issued by subsidiaries Vimpel-Communications OJSC and Vimpelcom Holdings B.V.
"The outlook revision reflects our view that Vimpelcom's credit metrics are unlikely to strengthen to a level commensurate with a 'BB+' rating in the next 18 months. This is because the Russian ruble and Ukrainian hryvnia devaluations, coupled with negative organic growth in these markets, have dragged down Vimpelcom's revenues and EBITDA," the press release says.
Russia and Ukraine accounted for 40%-45% of group consolidated revenues and EBITDA in the first nine months of 2014, and Russia is the group's domestic market," S&P said.
"We now anticipate under our base case that VimpelCom's total revenues and EBITDA will likely contract by about 15% year on year in 2015, after a similar expected drop in 2014, owing both to the weakening conditions in Russia and Ukraine and negative trends in other key markets, such as Italy."