ACRA upgrades Samolet Group PJSC’s outlook to positive
Samolet Group PJSC announces confirmation of its credit rating by the Analytical Credit Rating Agency(ACRA) at BBB+(RU) and the raising of its outlook from stable to positive.
The rating confirmation is based on the group's strong business profile, high business profitability, high corporate governance quality, strong liquidity, and low leverage. The outlook upgrade is attributed to the prerequisites for further improvement of leverage and debt service indicators. The Agency notes the Company’s strong business profile based on a very highly diversified project portfolio, stable project completion terms and timeline, as well as increased portfolio diversification by class over the past three years. The Company is a leader in housing construction by volume in the Moscow Region and Russia.
According to the Agency, despite the Company’s strong business profile and financial indicators, the primary limiting factor of its rating is the high industry risk due to the pronounced cyclical nature and high level of debt across the industry.
Andrey Pakhomenkov, Managing Director of Samolet Group:
“It is important for us to have the rating outlook upgraded to positive and the prospects for better rating revision acknowledged, especially given the current context, where the industry and the whole are recovering to their pre-crisis activity levels. For us, this is a confirmation of the high internal estimation of the efficiency of the strategy chosen. In the first half of the year, we managed to restrict the impact of the crisis on our business due to sound managerial decisions, participation in state support programs and strong financial results in Q1.
Unfortunately, the industry factor still has a great impact on the Company’s rating. However, we believe that industry consolidation brings many advantages, such as increased reliability of players, the setting of standards, and risk control. Our approach towards the organization of our activities - a flexible business model, transparent corporate governance and balanced financial policy — has proved to be effective. In line with the chosen strategy, we plan to achieve 20%+ growth in terms of the volume of contracts signed by the end of 2020, with the margin indicators significantly higher compared to 2019.”
Samolet Group PJSC is a leader in the residential property market of the Moscow Region and Russia. Most of the projects are implemented within integrated development. The Company’s current construction portfolio covers 1.28 million square meters (according to the Unified Developers Resource as of the beginning of July 2020).