1. Creditworthiness Rating of Antipinsky Oil Refinery CJSC Confirmed as “A+”

Creditworthiness Rating of Antipinsky Oil Refinery CJSC Confirmed as “A+”

01.08.2013
Antipinsky Oil Refinery CJSC was founded in 2004 in the Tyumen Region. Antipinsky Oil Refinery is a rapidly developing technology intensive medium-sized enterprise with the refining capacity of 4.2 million tons of crude oil p.a. It is the first private oil refinery of suchlike capacity built from scratch using up-to-date technologies on the territory of the Russian Federation over the past 30 years. Currently the range of products yielded by the enterprise includes stable natural gasoline (BGS); diesel fuel L-0, 2-62 for marine machinery, motor low-sulfur summer fuel (TMML), process export-grade fuel (TTE), М-40 and М-100 heating fuel oil. The processing depth makes up some 60%.
The first production complex of Antipinsky Oil Refinery with the throughput capacity up to 400 thousand tons p.a. was built and commissioned in 2006. Due to technical modernization the actual capacity of the first phase reached 740 thousand tons p.a. in 2008. In May 2010 the second workflow phase of the refinery with the capacity of 2.75 million tons p.a. was successfully commissioned. At the end of 2012 modernization of the second phase which made it possible to swell the overall capacity of the refinery up to 4.2 million tons p.a. was completed. At the end of 2013 - in the beginning of 2014 it is planned to commission the third primary oil refining unit, AT-3, as a result of which the throughput capacity will achieve 7.5 million tons p.a. The facilities of the refinery are built and modernized within the framework of time criteria fixed in the business plan. Diesel fuel hydrotreating unit will be built in the 4th quarter of 2014 for the purpose of improving the quality of diesel fuel as required by Euro-5 standards. At the end of 2015 the Company plans to increase the processing depth up to 94% due to the commissioning of a combined deferred tar carbonization unit with a fuel-oil vacuum distillation block. The transfer to Euro-5 high-octane gasoline is scheduled for the 4th quarter of 2016.
During several past years under review Antipinsky Oil Refinery shows high growth rates of operational and financial indices which fact is connected with both, the continuing investment development of the enterprise (increase of production facilities, modernization of those already commissioned, etc) and the availability of favorable external conditions, such as the oil product deficiency in the Tyumen Region and the advantageous geographical position of the enterprise. Antipinsky Oil Refinery located in the south-east of the Tyumen Region is lucky to have access to both, industrial resources (most of oil and gas reserves are concentrated in the Tyumen Region) and consumers (there is no need to make use of railway transport services for delivering products to the south of the region).
Antipinsky Oil Refinery is connected to the oil trunk pipelines of Transneft JSC with the capacity of 6 million tons p.a. taking into account the development of the enterprise including the third phase. Oil pipeline is a priority means of transporting oil. The Company has made direct contracts for buying oil with major extracting companies: Surgutneftegaz OJSC, LUKOIL OJSC. High quality of petroleum products yielded by the refinery provides for a rather wide distribution network both, within the country and outside it. In 2012 about 50% of sales accounted for export.

In 2012 Antipinsky Oil Refinery swelled its production output in natural terms by 10% having yielded about 2,846 thousand tons of oil products as against 2,586 thousand tons in 2011.
Each year the Company prepares reports in accordance with IAS/IFRS based on the data of the analysis of which the Agency assesses the creditworthiness and financial standing of Antipinsky Oil Refinery. The key financial indices have been demonstrating high growth rates for already three years in succession. As of the 2012 yearend the assets of the Company amounted to some 30.9 billion rubles what exceeded the relevant index of the previous year by 45%. The Company’s owned capital over the year 2012 grew by 36% making up ~ 5 billion rubles as of the yearend. The 2012 revenues accrued by 24% making up ~ 46.2 billion rubles according to IAS/IFRS, net profit grew by 35% making up ~1.9 billion rubles as of December 31, 2012.
Over the previous three years the Company’s activity has yielded increasing positive net profit, but, however, investment development of the refinery has not been finished yet (the construction and modernization plan of the refinery is drawn up until 2018), therefore, the Company raises considerable borrowed funds for financing its investment program. As of December 31, 2012 the debt burden of the Company is estimated at an acceptable, but higher than usual level. As of December 31, 2012 the joint debt amounted to some 18 billion rubles, net debt (exclusive of the cash balance on the Company’s balance sheet) amounted to 16.5 billion rubles, what exceeds EBITDA over the year 2012 almost 4 times. The time structure of the debt is favorable, more than 80% of liabilities are of a long-term nature.
As of December 31, 2012 the joint foreign debt of the company included indebtedness under the credit facility provided by BNP PARIBAS to the tune of ~ 0.76 billion rubles and indebtedness under the multi-currency credit agreement on extending term and revolving facilities (“Syndicated Loan”), the arrangers of which were Gazprombank (Open Joint Stock Company), Raiffeisen Bank International AG and ZAO Raiffeisenbank (CJSC) jointly with Glencore International AG, Vitol S.A., GLOBEXBANK CJSC, and WestLB AG (London) (“Authorized Arrangers”) to the tune of 16.3 billion rubles.
“Antipinsky Oil Refinery demonstrates high growth rates of its business, according to the 2012 results key financial indices, including revenues, owned capital, and net profit, have considerably increased. Improvements of profitability, liquidity, and turnover indices are observed over the previous year under review. The company has amassed enough experience, has already gained stable positive business reputation on the market in the area of its competence, operates using established contacts and long-term contracts on both, delivery of industrial resources and sales of products. The prospects of the enterprise’s development are estimated positively considering the plan for the growth of production facilities almost twice in the beginning of 2014 and the transfer in 2014-2016 to the production of Euro-5 fuel.” 
The moderately high level of the debt burden of the company related with the investment stage of the refinery’s development exerts restraining influence on its rating assessment,” Soboleva Natalia, senior analyst of the National Rating Agency, comments.

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