Russian Railways to issue up to GBP 1bn 20-year Eurobonds.

By bne IntelliNews March 18, 2011
Russian Railways (RZD) railroad monopoly plans to issue GBP 0.5bn-GBP 1bn worth of 20-year Eurobonds, PRIME-TASS reports citing the financial sources. Price guidance for the issue stands at 7.2%-7.5%. To remind, the road-show for the issue was planned for mid-March. In April 2010 RZD placed USD 1.5bn worth of 7-year Eurobonds at a coupon rate of 5.739%. As reported, IFRS net profit of Russian Railways more than quadrupled y/y to RUB 110.5bn in H1/10 vs. RUB 25bn seen in H1/09. Company?s IFRS net profit almost doubled y/y to RUB 152.2bn in 2009. In H1/10 revenues increased by 22% y/y to RUB 651bn, while EBITDA jumped 85% y/y to RUB 205bn. Recently Fitch Ratings affirmed long-term Issuers Default Rating (IDR) of Russian Railways at BBB, outlook Stable. Agency attributed the affirmation to full state ownership of the company, its strategic and systemic economic importance, as well as expected government support for the company. Russian Railways is 100% owned by the government.
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