The international rating agency Fitch has confirmed the credit rating of Naftogaz of Ukraine at "CC," as reported by the company.
"This rating is above Ukraine's sovereign rating of 'RD.' According to the agency's assessment, Naftogaz has moderate connections with the state, allowing for the company to be evaluated on an autonomous basis," the statement from Naftogaz noted on Wednesday.
According to the report, Fitch also confirmed the rating of Naftogaz's eurobonds issued by Kondor Finance plc at "C." The recovery rating was maintained at "RR6," as the company continues to make timely and full payments on the eurobonds that were restructured in 2023.
"One of the key factors influencing the company's position, according to Fitch, is the preservation of infrastructure and the stability of production growth, as well as the improvement of the company's financial indicators, particularly cash flow from operating activities," Naftogaz explains.
At the same time, the agency also indicates that high operational risks amid the war with Russia, the cessation of gas transit, non-payments for delivered gas, and limited access to external financing significantly impact the rating.
Additionally, Fitch highlighted the absence of any compensation from the state for Naftogaz's fulfillment of its special obligations (PSO) since the beginning of the war. It is noted that management continues to work with the government to obtain compensation for PSO and the difference in tariffs in 2024.