Fitch assigns BB- to Polyus

Fitch Ratings said it assigned PJSC Polyus a long-term issuer default rating of BB- with positive outlook and a short-term issuer default rating of B.

Polyus is the Russian holding and reporting company for the assets belonging to Polyus Gold International Ltd. (PGIL), following the latter's delisting in 2015.

Accordingly, the agency withdrew Polyus Gold’s BB- rating with positive outlook and short-term issuer default rating of B and will no longer provide ratings or analytical coverage for this entity.

The senior unsecured guaranteed notes issued by Polyus Gold, including $750 million notes due 2020, $500 million notes due 2022 and $800 million notes due 2023, were transferred to Polyus Finance plc, an indirect 100%-owned subsidiary of Polyus, as part of the reorganization and were affirmed at BB-.

“The positive outlook reflects our expectation that incremental production from Polyus' Natalka's mine and brownfield expansions will support the deleveraging necessary for an upgrade, ie, funds from operations (FFO) gross leverage below 3x by end-2019 (vs. 3.7x expected at end-2017 and 3.2x at end-2018),” Fitch said in a news release.

“The company's significant cash balances and management's commitment to reduce leverage also underpin the positive outlook.”

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