Fitch lowers Polski Koncern Naftowy

Fitch Ratings said it has downgraded Polski Koncern Naftowy Orlen SA's long-term foreign currency issuer default rating to BB+ from BBB- and the company's short-term foreign currency issuer default rating to B from F3.

The agency said it has also downgraded the company's long-term local currency issuer default rating to BB+ from BBB- and the company's short-term local currency issuer default rating to B from F3.

According to Fitch, Polski Koncern Naftowy foreign and local currency senior unsecured ratings were downgraded to BB+ from BBB-.

All the ratings remain on rating watch negative, where they were placed on Jan. 23 pending a financial covenant issue, the agency said, noting that the rating action reflects the company's high financial leverage given its business profile as an independent refining and marketing company, and sizeable capex program for 2009-2013 of PLN12.6 billion, ahead of an expected weakening of market conditions in the refining sector and already deteriorated conditions for the petrochemicals operations.

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