The credit rating of JSC Energy Formula (hereinafter, the Company) is based on the very high assessments of the Company’s market position, business, and geography, and the medium assessments of the corporate governance and the financial profile.
JSC Energy Formula is one of the largest companies in the mineral extraction industry in Russia.
KEY ASSESSMENT FACTORS
The very high assessment of the market position reflects the fact that the Company is a leader in the highly concentrated mining market.
The very high business assessment reflects the Company’s prime cost that is lower than that of other national and foreign peers, as well as the very high score for the sufficiency of the resource base, and the low score for product diversification. The Agency applied a positive analytical adjustment to the business score for the presence of assets from related industries in the Company’s perimeter.
The assessment of the Company’s geography is high due to the very high score for the Accessibility and Diversification of Sales Markets sub-factor, as well as the very high score for of the Concentration on One Field sub-factor (the largest mining asset accounts for less than 30% of consolidated production).
The medium corporate governance assessment is based on the high scores for the sub-factors Management Strategy (it reflects the presence of a long-term formalized strategy) and Management Structure. At the same time, the sub-factors Group Structure and Financial Transparency are assessed by ACRA as medium.
The medium assessment of the financial profile reflects the very high score for the size of the Company’s business and the high score for profitability (in 2025, the FFO before net interest payments and taxes margin decreased to 20% vs. 25% in 2024 and is expected to reach 27% in 2026). In addition, ACRA takes into account the low score for leverage (the ratio of total debt to FFO before net interest payments was 7.4x in 2025, and is expected to be 4.8x in 2026) and the low score for the coverage (the ratio of FFO before net interest payments to interest payments was 0.9x in 2025, and is expected to be 1.5x by the end of 2026). The Company’s liquidity scored medium (taking into account the high qualitative assessment of liquidity). The weighted cash flow assessment is very low due to the very low score for the free cash flow (FCF) margin and the low score for the capital expenditures-to-revenues ratio.
KEY ASSUMPTIONS
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Production volume in line with the Company’s business plan;
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Capital expenditures in line with the Company’s business plan;
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No dividend payments during the forecast period from 2026 to 2028.
POTENTIAL OUTLOOK OR RATING CHANGE FACTORS
The Stable outlook assumes that the rating will highly likely stay unchanged within the 12 to 18-month horizon.
A positive rating action may be prompted by:
- Weighted ratio of FFO before net interest payments to interest payments exceeding 2.5x.
A negative rating action may be prompted by:
- Weighted ratio of FFO before net interest payments to interest payments falling below 1.0x.
RATING COMPONENTS
SCA: а.
REGULATORY DISCLOSURE
The credit rating has been assigned to JSC Energy Formula based on the following methodologies: the Methodology for Assigning Credit Ratings to Non-Financial Corporations under the National Scale for the Russian Federation to calculate the SCA and determine the credit rating and the credit rating outlook of JSC Energy Formula under the national scale for the Russian Federation and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities to ensure consistent and uniform application of ACRA’s methodologies, rating scales, models, and key rating assumptions.
A credit rating of JSC Energy Formula assigned under the national scale for the Russian Federation has been published by ACRA for the first time.
The credit rating and its outlook are expected to be revised within one year.
The credit rating was assigned based on data provided by JSC Energy Formula, information from publicly available sources, and ACRA’s own databases. The rating analysis was performed using the IFRS financial statements of JSC Energy Formula as of December 31, 2025.
The credit rating is solicited and JSC Energy Formula participated in its assignment.
In assigning the credit rating, ACRA used only information, the quality and reliability of which were, in ACRA’s opinion, appropriate and sufficient to apply the methodologies.
ACRA provided no additional services to JSC Energy Formula during the year preceding the rating action.
No conflicts of interest were discovered in the course of credit rating assignment.
