Fitch downgraded long-term foreign currency Issuer Default Rating of Fesco

Fesco shippingInternational rating agency Fitch downgraded the long-term foreign currency Issuer Default Rating of transport group Fesco from CC to C. The credit rating downgrade followed the announcement of the shipping company that will not settle the interest payments of the Eurobond with 8% yields with maturity in 2018 and Eurobond with 8.25% yields with maturity in 2020. The company was obliged to pay the interest to its bond-holders on May 4, but informed that will delay payments due to weak liquidity and low cash flows. Fesco warned about continuing deterioration of the operating performance and weak cash generation, on the background of delay in world economy and low freight rates.

International rating agency Fitch analysts believe that Fesco financial performance will improve in 2016, but the outlook remains uncertain.

Earlier this month, Fitch downgraded the long-term foreign currency Issuer Default Rating of Fesco from B- to CC, because of the finance and liquidity problems of the group, as well as weak cash flows and volatility of the ruble.

Transport and shipping group Fesco is one of the largest private transport and logistics companies in Russia with assets in the area of ​​the port, rail and integrated logistics business.