Fitch upgrades MHP up to B

23 September 2017

The upgrade follows improvement of liquidity position of the largest Ukrainian poultry producer after new Eurobonds issue.

MHP placed USD 500M Eurobonds with maturity of Y2024 in May 2017 and used its proceeds to partially (by USD 245M) refinance USD 750M Eurobonds of the company with maturity in Y2020 (i.e. reducing refinancing risk for Y2020). Remaining part of proceeds from the placement was directed to short-term debt of the company repayment and creation of additional liquidity buffer.

Fitch also notes renewal in August 2017 of USD 100M PXF facility of the company which allows MHP to cover the funding needs for sunflower seeds origination in new season (in addition the company extended tenor of PXF facility from one to three years).

In its report the agency also notes strong business profile of the company, but mulls over still evident FX risk, as all the borrowing of MHP are nominated in foreign currency, while more than 40% of revenues is still in UAH (though MHP works on increase of export share of its sales).

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