Fitch affirms Petrol Ofisi

Fitch Ratings said it affirmed Petrol Ofisi AS's local- and foreign-currency issuer default ratings at BB- and national long-term rating at A(tur), along with the senior unsecured rating on $175 million notes of its subsidiary PO Oil Financing Ltd. at BB-.

The outlook is stable.

The ratings are affirmed despite additional fines by the tax authorities related to back-dated taxes, the agency said. Fitch said it does not expect the company to set aside any provisions for these charges and does not expect any cash outflow from the company related to these in the short- to medium-term, but will in any case continue to closely watch the developments on back-dated taxes.

In a downside scenario, Petrol Ofisi's leverage may deteriorate to the 1.5x to 1.9x range, still within the limits of the current rating category, Fitch said. However, any deterioration beyond this mark would put pressure on the ratings.

The ratings are underpinned by the company's leading domestic market position in the diesel market despite consolidation and elevated competition in the sector, the agency said.

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