ACRA assigned the status of “rating under review—negative” to Istrinskaya Syrovaryna

The agency (ACRA) assigned the credit rating of Istra Cheese Factory LLC the status “rating under review – negative”. From press release It follows that the decision was made in connection with the company’s plans to raise additional debt. ACRA may remove this status if the debt burden of Istra Cheese Factory remains within the range of 100–150 million rubles. in 2023–2025.

“Previously, ACRA was based on the plans of Istra Cheese Factory to refinance the bond issue placed in March 2023 using funds raised as part of the placement of a new bond issue in August of this year, and maintaining the amount of debt of Istra Cheese Factory within 100-150 million RUB,” the agency explained.

ACRA recalled that the credit rating of Istra Cheese Factory BB- (RU) was due to a weak assessment of the operational risk profile. Istra Cheese Factory is part of the informal Russian Parmesan group, within which production and trading assets belong to different owners. The assessment of the company’s operational risk profile was also influenced by the steady demand for the company’s products while concentrating its activities on a narrow segment.

“The assessments of financial risk profile factors were determined by a moderately high debt burden with a low assessment for the size of the business and a high level of profitability. ACRA assesses the company’s liquidity at an average level and cash flow as weak,” the press release notes.

Istra Cheese Factory LLC was established in 2016 in the Istra district of the Moscow region. The company sells products of the Russian Parmesan group under the brand Oleg Sirota’s Istra Cheese Factory. As of May 2023, the company opened 154 stores in Moscow, the Moscow region, St. Petersburg and the Leningrad region. The revenue of Istra Cheese Factory for the first half of 2023 amounted to 862 million rubles, net profit – 2.59 million rubles.