The Analytical Credit Rating Agency (ACRA) has assigned the highest credit rating to the Russian oil and gas company Zarubezhneft at the AAA (RU) level with a Stable outlook. This is the first ACRA rating assigned to the company.
Key assessment factors include systemic importance, government influence, operational risk profile, profitability, debt burden, liquidity and cash flow assessment. The assigned rating is based on data provided by Zarubezhneft, information from open sources, as well as ACRA data bases.
Among the sides of the company, especially noted by the agency, are the strong operational risk profile of Zarubezhneft, high geographic diversification, low risks per field, low cost and high sufficiency of the resource base. According to ACRA assessment, the company is also highly profitable: for the period from 2018 to 2023 its profitability is 33.9% according to FFO before interest payments and taxes.
The agency also highlighted Zarubezhneft's low debt burden, high interest coverage, and strong liquidity. It estimates the company is increasing its capital investment in already existing projects and buying new ones in the coming years. At the same time, the accumulated cash and liquid financial investments, if necessary, make it possible to fully finance dividend payments, capital expenditures and debt repayment within the framework of the company's obligations.
In addition, ACRA noted the systemic importance of Zarubezhneft: the company remains a conductor of Russia's interests in the fuel and energy complex on the international arena, in particular, in such strategically important countries as Vietnam and Cuba.
“The high rating of ACRA once again confirms the stable and successful work of Zarubezhneft in the market,” comments Sergey Kudryashov, General Director of Zarubezhneft, - “The company continues active and diversified activities in several countries around the world”.
ACRA's credit rating at the highest level of the national scale, along with the Expert RA agency's ruAAA credit rating assigned in December 2020, confirms the maximum creditworthiness of Zarubezhneft. The “Stable” outlook assumes with the maximum degree of probability that the rating forecasting for the term of 12-18 months.
Zarubezhneft JSC is a Russian oil and gas company of strategic importance having rich history and unique 50-years long experience of foreign economic activity. The Company’s projects include operations offshore Vietnam in the framework of activities of the joint venture Vietsovpetro, development of fields in the Nenets Autonomous Area in the framework of the joint company RUSVIETPETRO and Kharyaga PSA, application of EOR technologies for heavy oil fields development in Cuba and downstream activities in the Republic of Srpska (Bosnia and Herzegovina).