Arcelik AS logo

ARCLK - Arcelik AS News Story

TRY32.8 0.0  0.0%

Last Trade - 07/05/21

Sector
Consumer Cyclicals
Size
Mid Cap
Market Cap £1.93bn
Enterprise Value £2.73bn
Revenue £4.01bn
Position in Universe 21st / 645

Fitch Reviews Turkish Corporates Following Sovereign Action

Thu 19th July, 2018 6:01pm
(The following statement was released by the rating agency)


Link to Fitch Ratings' Report(s): Fitch Reviews Turkish Corporates Following 
Sovereign Action 

https://www.fitchratings.com/site/re/10038662

Fitch Ratings-London-July 19: Fitch Ratings has reviewed the ratings of 11 
Turkish corporates following the downgrade of Turkey's sovereign ratings.

On 13 July 2018 Fitch downgraded Turkey's Long-term Foreign Currency Issuer 
Default Rating (IDR) to 'BB'/Outlook Negative (see 'Fitch Downgrades Turkey to 
'BB'; Outlook Negative' at www.fitchratings.com).

KEY RATING DRIVERS

Coca-Cola Icecek (see 'Fitch Rates Coca-Cola Icecek's Planned Unsecured Eurobond 
Issue 'BBB(EXP)' dated 5 September 2017)

The downgrade of Coca-Cola Icecek's (CCI) Long-Term Foreign Currency IDR to 
'BBB-' follows the downgrade of Turkey's Country Ceiling to 'BB+'. Fitch assumes 
a one notch uplift from the Country Ceiling to reflect the strong implied 
support of The Coca-Cola Company (TCCC) (A/Stable), which owns 20.1% of CCI and 
exercises a large degree of influence over major decisions. 

Affirmation of the Long-Term Local Currency 'BBB' IDR reflects Fitch's view that 
the credit profile of the group is not likely to be materially affected by the 
potential deterioration in the operating environment in Turkey due to its 
leading market positions and resilient nature of the soft drinks industry in 
Turkey. The 'BBB' rating is also supported by a large portion of its overseas 
operations, as well as implied support from TCCC.

Emlak Konut Gayrimenkul Yatirim Ortakligi A.S. (see 'Fitch Assigns Emlak Konut 
Local Currency and National Ratings' dated 18 April 2017)

The downgrade reflects that Emlak Konut operates under the ownership of TOKI, 
which Fitch views as a government-related entity, and is exposed to a weakening 
Turkish economy and a volatile domestic housing market.

Baskent Elektrik Dagitim A.S. (see 'Fitch Affirms Baskent Elektrik Dagitim at 
'AA(tur)'; Outlook Stable' dated 22 June 2017)

Enerjisa Enerji A.S. (see 'Fitch Affirms Enerjisa Enerji A.S. at 'AA(tur)'; 
Outlook Stable' dated 19 December 2017)

These affirmations reflect both Baskent's and Enerjisa's high percentage of 
earnings from regulated activities with returns adjusted for inflation leading 
to more predictable cash flows than peers'. Both companies have some flexibility 
over the timing of their investments as both have invested more at the beginning 
of the current regulatory period (RP3 lasts from 2016 to 2020). 

Compared with some domestic peers, Enerjisa and Baskent operate at minimum cash 
balances and rely on uncommitted credit lines from local banks and Fitch regards 
liquidity as a rating constraint. Funding is in local currency and exposure to 
foreign currency debt (EUR63 million before hedges at end-2017) is immaterial. 

Arcelik (see 'Fitch Affirms Arcelik at 'BB+', Outlook Stable' dated 22 June 
2017)

The affirmation reflects Arcelik's solid export revenue backed by the company's 
geographically diverse footprint. Arcelik has become a more geographically 
diverse white-goods manufacturer, with less exposure to the Turkish economy in 
the past 10 years. Revenue from the domestic market declined to 36% in 2017 from 
50% in 2008, as Arcelik made solid market share gains in Europe and expanded 
into new emerging markets, further supporting hard currency cash inflows.

Migros Ticaret A.S. (see 'Fitch Assigns Migros First-Time National Long-Term 
Rating of 'AA-(tur)' dated 7 May 2018)

The affirmation of the Migros' national scale rating reflects our expectation 
that the company will maintain its free cash flow (FCF) generation and 
deleveraging capacity, despite a weakened operating environment and Turkish lira 
depreciation. The rating benefits from Migros' strong market position and a 
favourable food retail market structure with a high share of traditional 
retailers. 

Ronesans Gayrimenkul Yatirim A.S. (see Fitch Assigns Ronesans Gayrimenkul 
Yatirim a Final IDR of 'BB+' dated 4 May 2018)

The affirmation of the Ronesans' national scale rating reflects the company's 
position as a leading Turkish property investment company, with a portfolio of 
retail and office assets with a diversified tenant base.

Turk Telekomunikasyon A.S. (TT) (see 'Fitch Affirms Turk Telekom at 'BBB-'; 
Outlook Negative' dated 18 September 2017)

The downgrade reflects TT's exposure to a weakening Turkish economy as the 
leading integrated telecoms player in Turkey. 

Turkcell Iletisim Hizmetleri A.S (see 'Fitch Revises Turkcell Outlook to Stable; 
Affirms at 'BBB-' dated 29 March 2018)

The downgrade reflects Turkcell's exposure to a weakening Turkish economy as 
Turkey's leading mobile operator.

Turkcell Finansman A.S. (TFS) (see 'Fitch Revises Turkcell Finansman's Outlook 
to Stable; Affirms at 'BB+' dated 11 April 2018)

The downgrade reflects the similar rating action on TFS's parent, Turkcell 
Iletisim Hizmetleri A.S.  TFS's ratings are based on potential support from the 
parent Turkcell. Fitch believes Turkcell would have a strong propensity to 
support TFS given (i) its 100% stake and full operational control; (ii) the 
close integration of the subsidiary with its parent; and (iii) TFS's role in 
customer base acquisition for Turkcell. The one-notch difference between the 
ratings of Turkcell and TFS reflects the subsidiary's focus on a different 
segment (finance rather than telecom services) and short operating history.  

Turkiye Petrol Rafinerileri A.S. (Tupras) (see 'Fitch Assigns Tupras' Notes 
Final 'BBB-' Rating' dated 17 October 2017)

The downgrade reflects the sovereign risk factors. Around 80% of Tupras' revenue 
is domestic sales and most of the company's predominantly foreign-currency cash 
balances are kept at Turkish banks.

DERIVATION SUMMARY

See relevant rating action commentaries (RACs) for each issuer

KEY ASSUMPTIONS

See relevant RACs for each issuer

RATING SENSITIVITIES

For those issuers, which were downgraded, the additional positive rating 
sensitivity is a positive sovereign rating action on Turkey.

For other rating sensitivities determined in the most recent ratings committees 
for individual issuers see relevant RACs.

LIQUIDITY

See relevant RACs for each issuer 

FULL LIST OF RATING ACTIONS

See attached Rating Action report

 

Contact: 

See attached Rating Action Report

 

Summary of Financial Statement Adjustments - See relevant RACs for each issuer

Media Relations: Adrian Simpson, London, Tel: +44 203 530 1010, Email: 
adrian.simpson@fitchratings.com.

Additional information is available on www.fitchratings.com. For regulatory 
purposes in various jurisdictions, the supervisory analyst named above is deemed 
to be the primary analyst for this issuer; the principal analyst is deemed to be 
the secondary.

Applicable Criteria 

Corporate Rating Criteria (pub. 23 Mar 2018)

https://www.fitchratings.com/site/re/10023785

Corporates Notching and Recovery Ratings Criteria (pub. 23 Mar 2018)

https://www.fitchratings.com/site/re/10024585

National Scale Ratings Criteria (pub. 18 Jul 2018)

https://www.fitchratings.com/site/re/10038626

Non-Bank Financial Institutions Rating Criteria (pub. 22 Jun 2018)

https://www.fitchratings.com/site/re/10034715

Non-Financial Corporates Exceeding the Country Ceiling Rating Criteria (pub. 23 
Jan 2018)

https://www.fitchratings.com/site/re/916483

Parent and Subsidiary Rating Linkage (pub. 16 Jul 2018)

https://www.fitchratings.com/site/re/10036366

Additional Disclosures 

Dodd-Frank Rating Information Disclosure Form 

https://www.fitchratings.com/site/dodd-frank-disclosure/10038649

Solicitation Status 

https://www.fitchratings.com/site/pr/10038649#solicitation

Endorsement Policy 

https://www.fitchratings.com/regulatory

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. 
PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:  
HTTPS://WWW.FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING 
DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S 
PUBLIC WEB SITE AT WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA, AND 
METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF 
CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE, 
AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE CODE OF 
CONDUCT SECTION OF THIS SITE. DIRECTORS AND SHAREHOLDERS RELEVANT INTERESTS ARE 
AVAILABLE AT HTTPS://WWW.FITCHRATINGS.COM/SITE/REGULATORY. FITCH MAY HAVE 
PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD 
PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED 
IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS 
ISSUER ON THE FITCH WEBSITE.

Copyright © 2018 by Fitch Ratings, Inc., Fitch Ratings Ltd. and its 
subsidiaries. 33 Whitehall Street, NY, NY 10004. Telephone: 1-800-753-4824, 
(212) 908-0500. Fax: (212) 480-4435. Reproduction or retransmission in whole or 
in part is prohibited except by permission. All rights reserved. In issuing and 
maintaining its ratings and in making other reports (including forecast 
information), Fitch relies on factual information it receives from issuers and 
underwriters and from other sources Fitch believes to be credible. Fitch 
conducts a reasonable investigation of the factual information relied upon by it 
in accordance with its ratings methodology, and obtains reasonable verification 
of that information from independent sources, to the extent such sources are 
available for a given security or in a given jurisdiction. The manner of Fitch's 
factual investigation and the scope of the third-party verification it obtains 
will vary depending on the nature of the rated security and its issuer, the 
requirements and practices in the jurisdiction in which the rated security is 
offered and sold and/or the issuer is located, the availability and nature of 
relevant public information, access to the management of the issuer and its 
advisers, the availability of pre-existing third-party verifications such as 
audit reports, agreed-upon procedures letters, appraisals, actuarial reports, 
engineering reports, legal opinions and other reports provided by third parties, 
the availability of independent and competent third- party verification sources 
with respect to the particular security or in the particular jurisdiction of the 
issuer, and a variety of other factors. Users of Fitch's ratings and reports 
should understand that neither an enhanced factual investigation nor any 
third-party verification can ensure that all of the information Fitch relies on 
in connection with a rating or a report will be accurate and complete. 
Ultimately, the issuer and its advisers are responsible for the accuracy of the 
information they provide to Fitch and to the market in offering documents and 
other reports. In issuing its ratings and its reports, Fitch must rely on the 
work of experts, including independent auditors with respect to financial 
statements and attorneys with respect to legal and tax matters. Further, ratings 
and forecasts of financial and other information are inherently forward-looking 
and embody assumptions and predictions about future events that by their nature 
cannot be verified as facts. As a result, despite any verification of current 
facts, ratings and forecasts can be affected by future events or conditions that 
were not anticipated at the time a rating or forecast was issued or affirmed. 

The information in this report is provided "as is" without any representation or 
warranty of any kind, and Fitch does not represent or warrant that the report or 
any of its contents will meet any of the requirements of a recipient of the 
report. A Fitch rating is an opinion as to the creditworthiness of a security. 
This opinion and reports made by Fitch are based on established criteria and 
methodologies that Fitch is continuously evaluating and updating. Therefore, 
ratings and reports are the collective work product of Fitch and no individual, 
or group of individuals, is solely responsible for a rating or   a report. The 
rating does not address the risk of loss due to risks other than credit risk, 
unless such risk is specifically mentioned. Fitch is not engaged in the offer or 
sale of any security. All Fitch reports have shared authorship. Individuals 
identified in a Fitch report were involved in, but are not solely responsible 
for, the opinions stated therein. The individuals are named for contact purposes 
only. A report providing a Fitch rating is neither a prospectus nor a substitute 
for the information assembled, verified and presented to investors by the issuer 
and its agents in connection with the sale of the securities. Ratings may be 
changed or withdrawn at any time for any reason in the sole discretion of Fitch. 
Fitch does not provide investment advice of any sort. Ratings are not a 
recommendation to buy, sell, or hold any security. Ratings do not comment on the 
adequacy of market price, the suitability of any security for a particular 
investor, or the tax-exempt nature or taxability of payments made in respect to 
any security. Fitch receives fees from issuers, insurers, guarantors, other 
obligors, and underwriters for rating securities. Such fees generally vary from 
US$1,000 to US$750,000 (or the applicable currency equivalent) per issue. In 
certain cases, Fitch will rate all or a number of issues issued by a particular 
issuer, or insured or guaranteed by a particular insurer or guarantor, for a 
single annual fee. Such fees are expected to vary from US$10,000 to US$1,500,000 
(or the applicable currency equivalent). The assignment, publication, or 
dissemination of a rating by Fitch shall not constitute a consent by Fitch to 
use its name as an expert in connection with any registration statement filed 
under the United States securities laws, the Financial Services and Markets Act 
of 2000 of the United Kingdom, or the securities laws of any particular 
jurisdiction. Due to the relative efficiency of electronic publishing and 
distribution, Fitch research may be available to electronic subscribers up to 
three days earlier than to print subscribers. 

For Australia, New Zealand, Taiwan and South Korea only: Fitch Australia Pty Ltd 
holds an Australian financial services license (AFS license no. 337123) which 
authorizes it to provide credit ratings to wholesale clients only. Credit 
ratings information published by Fitch is not intended to be used by persons who 
are retail clients within the meaning of the Corporations Act 2001

Fitch Ratings, Inc. is registered with the U.S. Securities and Exchange 
Commission as a Nationally Recognized Statistical Rating Organization (the 
"NRSRO"). While certain of the NRSRO's credit rating subsidiaries are listed on 
Item 3 of Form NRSRO and as such are authorized to issue credit ratings on 
behalf of the NRSRO (see https://www.fitchratings.com/site/regulatory), other 
credit rating subsidiaries are not listed on Form NRSRO (the "non-NRSROs") and 
therefore credit ratings issued by those subsidiaries are not issued on behalf 
of the NRSRO. However, non-NRSRO personnel may participate in determining credit 
ratings issued by or on behalf of the NRSRO
© Stockopedia 2021, Refinitiv, Share Data Services.
This site cannot substitute for professional investment advice or independent factual verification. To use it, you must accept our Terms of Use, Privacy and Disclaimer policies.