RPT-Fitch: Turkish Corporate Ratings at Risk from Prolonged Lira Decline

Fri Feb 14, 2014 2:07am EST

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Feb 14 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings says in a new report that Turkish corporates could see their financial profiles weaken under a 30% Turkish lira depreciation scenario.

The report evaluates the effects of the Turkish lira depreciation on 10 publicly rated Turkish corporates, and the possible negative implications for their ratings. The first part of the report focuses on a straightforward calculation and the effects on leverage metrics, assuming the initial impact of a 30% fall of the Turkish lira against a basket of currencies since end-2012 and shows the effects on publicly rated Turkish issuer's gross leverage (gross debt/EBITDA).

The second part of this report focuses on each issuer's individual FX exposure, and natural hedging mechanisms in detail, providing a broader view of the depreciation effects on gross leverage and profitability.

The companies covered in the report are in manufacturing, food and beverage, TMT and energy industries. They are:

Yasar Holding A.S.

Hurriyet Gazetecilik ve Matbaacilik A.S.

Dogan Yayin Holding AS

Turcas Petrol A.S.

Coca Cola Icecek

Merinos Hali Sanayi ve Ticaret A.S.

Arcelik

Turkiye Petrol Rafineileri A.S. (Tupras)

Yuksel Insaat AS

Habas Sinai ve Tibbi Gazlar Istihsal Endustrisi A.S

The report, "Fitch: Turkish Lira Prolonged Decline in the Currency Would Put Pressure on Ratings", is available from www.fitchrratings.com or by clicking on the link below.

Link to Fitch Ratings' Report: Turkish Lira Fall Threatens Companies With FX Mismatches

here

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