- On Monday, May 23, 2022, the international credit rating agency Moody’s confirmed Ba1 credit rating of Zagreb Holding with a stable outlook.
According to the report, the credit rating of Zagreb Holding is underpinned by strong financial and institutional links with its shareholder, the City of Zagreb, and strategic role of Holding by providing utility services in the city of Zagreb. Stable prospects reflect the agency’s expectation that the City of Zagreb will provide timely support to Zagreb Holding if necessary. The rating also reflects the favorable regulatory framework, which ensures the stability and predictability of future revenue streams in the Holding’s core business.
Looking back on the business year 2021, the agency recognized the negative effects of the pandemic, supply chain disruptions, inflationary trends and the energy market crisis on the business results of Zagreb Holding. However, Moody’s expects the EBITDA to improve significantly this year to approximately HRK 500 million, which represents 12% of operating revenues forecasted over the same period.
Namely, taking into account the organizational restructuring started in the fourth quarter of last year, the announced merger and optimization of corporate functions and other measures to stabilize the Holding’s businesses planned this year, Moody’s expects that operating costs will be further reduced in 2022, despite challenges of the energy market’s price and difficulties in supply chains. The undertaken activities of savings from operational efficiency will also have a positive effect on the reduction of credit indebtedness to financial institutions.