Fitch revises Sibur to positive

Fitch Ratings said it affirmed petrochemical group Sibur Holdings’ long-term issuer default rating at BB+ and revised its outlook to positive from negative.

Fitch said the positive outlook reflects Sibur’s comfortable leverage throughout its intensive investment cycle, the reduced execution risk on the ZapSib project and the expected strengthening of its business profile once the project is launched in late 2019.

“Sibur outperformed our 2017 base case with funds from operations (FFO) adjusted net leverage at 2.0x. We now forecast the ratio at 2.2x-2.3x until 2019 and below 2x thereafter as the company comes out of its intensive investment cycle and as capacity from ZapSib project comes on stream,” the agency said in a news release.

“This contrasts with our previous leverage expectations of 3x in 2018 and 2.7x in 2019 on the back of higher capex and lower EBITDA forecasts.”

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