International rating agency Standard & Poor's has announced that it has raised the credit rating for Russian telecommunications company Rostelekom from B- to B. The agency's press release says that the increased rating is connected with the successful restructuring of debts to the Finance Ministry and the improvement in the system of inter-network cooperation with other telecommunication companies. The agency's rating and forecast is considered positive.
The press release goes on to say that the decision to raise the credit rating reflects most of all the gradual lowering of the company's debt load, positive influence of the recent changes in the terms and conditions of mutual accounts for call traffic and the clearing up of the debt payment transfer issue.
Standard & Poor's expects further improvements in the structure of capital of Rostelekom and a correspondingly positive influx of capital from sales. 'It is also expected that Rostelekom shall achieve asset growth higher than the rate of inflation by largely relying on improvements in the system of inter-network cooperation and actively defending its leading position in the Moscow telecommunications market. The observed improvements in the indicators of operating activity and liquidity could lead to a further improvement in the company's rating,' said the Standard & Poor's press release.
Rostelekom is the national telephone operator for inter-city and international electronic communications. The company provides consumers in Russia with connections to 211 countries and has direct international connections with 75 operators in 72 countries. The company's main shareholder is the Svyazinvest holding with 50.67% of the shares. Foreign shareholders own 41.48% of the company's shares, Russian shareholders own 5.49% and Rostelekom employees own the remaining 2.36%. The company had profits, according to Russian accounting standards, of USD 103.2 million in 2002 and a 38.6% year-on-year.
As many as 17 foreign countries owe Russia a total of $27 billion with Belarus, Ukraine and Venezuela being the largest debtors