ASTANA, Kazakhstan, October 18. Fitch Ratings has reaffirmed the Long-Term Foreign-Currency Issuer Default Rating (IDR) of JSC Samruk-Energy, a leading energy company based in Kazakhstan, at 'BB+', Trend reports.
The outlook remains stable, reflecting the company's strategic positioning and expected support from the government, according to the latest report by Fitch.
The affirmation and stable outlook derive from Fitch's 'top-down minus two' notch approach, which relates to Kazakhstan's sovereign rating of 'BBB' with a stable outlook. This rating is based on Fitch’s assessment of a “Very Likely” expectation for government support, combined with Samruk-Energy's Standalone Credit Profile (SCP) of 'b+'.
The company's SCP is projected to face challenges in the near term, primarily due to a weakening financial profile. Fitch anticipates an increase in funds from operations (FFO) net leverage, which is expected to rise to 5.2x by 2026, compared to 2.0x in 2023. This change is attributed to significant capital expenditures funded by debt related to major projects, including the Almaty gasification initiative.
While the free cash flow (FCF) is projected to remain deeply negative between 2024 and 2026 due to these ongoing investments, the situation is somewhat mitigated by the expected strong support from the state. This includes guarantees for project-related debt, equity injections, and contributions of assets that will provide financial stability during the investment phase.
Fitch anticipates that operational performance will remain positive, and deleveraging is expected to begin in 2027 once the primary capital projects are completed. The company's commitment to its investment strategy, combined with state backing, positions Samruk-Energy for potential recovery and growth in the following years.