The credit rating of Simple Group (hereinafter, Simple Group, the Company, or the Group) reflects the strong operational profile, which, in turn, is based on the high assessments of business and geography, and the moderate assessment of corporate governance. The financial profile reflects the moderately low leverage, medium business size, strong FCF margin, and strong liquidity. The credit rating is supported by very high profitability, but is constrained by the weak debt service indicator.
According to the preliminary results of the 2025 fiscal year, the Company increased its FFO before net interest payments and taxes by 27%, which does not fully correspond to the planned value. At the same time, Simple Group managed to reduce its debt burden and optimize working capital, which allowed the Agency to change the outlook on the Company’s credit rating from Negative to Stable. In its forecast for fiscal years 2026–2028, ACRA assumes a more moderate growth rate for the Group’s business.
Simple Group is one of the leading importers of still, sparking, and champagne wines in Russia. The Group is the leader in terms of shipped alcohol in the HoReCa1 segment, acting as a major supplier to federal and regional grocery retail chains. One of the distribution channels is a chain of wine stores associated with the Group that carries the SimpleWine brand and includes more than 100 locations (but is not part of the IFRS consolidation perimeter). The Company is also developing its own brands of wine and strong alcoholic beverages.
1 Not including beer, cider, perry, and distillates.
KEY ASSESSMENT FACTORS
Operational profile. ACRA continues to highly assess the Company’s operational profile, noting the strong market positions, very low cyclicality of demand for alcoholic beverages, and the well-balanced structure of settlements. After 2022, amid geopolitical tensions, foreign suppliers revised their payment terms, which, combined with the Company’s build-up of inventory in anticipation of higher import duties, pushed up the need for both working capital and debt. Subsequent stabilization of the operating environment, which the Agency noted a year earlier, was confirmed by a near-zero change in the Company’s working capital by the end of FY 2024 (July 1, 2024 to June 30, 2025), and ACRA expects the same value by the end of FY 2025. The Group, in turn, notes that there are still opportunities for further improvement of supply terms.
When assessing the quality of counterparties, the Agency took into account that the Group’s overdue accounts receivable did not exceed 20%. ACRA also notes that an extremely low proportion of overdue accounts receivable becomes uncollectible, although it allows for some growth against the background of high interest rates and slowing business activity, especially in the HoReCa segment.
The Agency still highly appreciates the geography of the Company’s business: Simple Group has a highly diversified distribution network, the SimpleWine wine store chain associated through the shareholder, while well-established import logistics is a competitive advantage of the Group.
Corporate governance is assessed as medium, mainly due to low financial transparency (Simple Group makes but does not discloses its IFRS financial statements) and the absence of a board of directors. ACRA highly assesses the group’s strategy, which allows the Company to successfully adapt to changes in the market. Additional information about the related parties and the analysis of their publicly available financial statements, allowed us to conclude that the Group’s related-party transactions are were economically sound and that there were no large opaque transactions, which elevated the score for the group structure to medium.
Medium business size and very high profitability. The Agency expects that by the end of FY 2025, FFO before net interest payments and taxes will grow by more than a quarter and reach RUB 6.6 bln, and the sales volume will be RUB 43 bln. The weighted average indicators for FY 2023 to FY 2028 correspond to medium scores.
The FFO before net interest payments and taxes margin remains very high: by the end of FY 2025, it is expected to grow to 16% compared with 13% a year earlier, and further stabilize at about 15%.
Moderately low leverage and low coverage of interest payments. ACRA highly assesses the quality of the Group’s credit portfolio, which consists of loans granted by large Russian banks, lease obligations, and bonds. The Agency expects that by the end of FY 2025, the Group’s leverage will decrease significantly due to an increase in FFO before net interest payments and a slight decrease in the total debt: the ratio of total debt (including leases and guarantees issued to related parties) to FFO before net interest payments will be 3.0x as of June 30, 2026 vs. 3.9x a year earlier.
According to ACRA’s projections, the weighted average ratio of total debt to revenue for FY 2023–2028 will be 0.41x, which corresponds to the moderate score, and the weighted average ratio of total debt to FFO before net interest payments over the same period will be 3.0x, which corresponds to the high score.
The coverage of interest payments remains low, but it tends to improve. According to ACRA’s projections, the weighted average ratio of FFO before net interest payments to interest payments for FY 2023–2028 will be 1.9x.
Strong liquidity and FCF. The liquidity level of the Simple Group is still assessed as high. The Company’s credit portfolio consists of short-term bank loans (as well as significant undrawn credit limits), lease obligations, and bonds, so that the Company does not need to raise debt.
The return of the need for working capital to levels more typical for the Company, along with an increase in operating cash flow, has pushed up the FCF and allowed us to elevate the score for FCF margin from medium to high. ACRA estimates that the weighted average FCF margin for FY 2023–2028 will be 1.7%. The Agency notes that the credit rating level is extremely sensitive to the score for the FCF margin since any market shocks or the Company’s more aggressive approach to increasing inventory may result in the revision of the credit rating.
KEY ASSUMPTIONS
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Maintaining the ability to make import purchases without significant negative changes;
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Maintaining the moderately stable regulatory environment without any significant changes.
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 average FFO before net interest payments to interest payments exceeding 2.5x and the ratio of total debt to revenue falling below 0.35x.
A negative rating action may be prompted by:
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Weighted average FCF margin declining below 1.5%;
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The share of overdue receivables consistently exceeding 20%;
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Weaker market position, increased competition;
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Deteriorating structure of settlements with suppliers and buyers;
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Weighted average ratio of total debt to revenue exceeding 0.5x;
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Weighted average ratio of total debt to FFO before net interest payments exceeding 4.0x;
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Weighted average ratio of FFO before net interest payments to interest payments declining below 1.0х;
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Sharp and significant toughening of import regulations;
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Negative impact of the consolidation of the wine store chain associated with Simple Group on the Group’s financial indicators.
RATING COMPONENTS
Standalone creditworthiness assessment (SCA): a-.
issue ratings
Bond of COMPANY “SIMPLE” LLC, series 001Р-01 (RU000A10A398), maturity date: November 5, 2026, issue volume: RUB 1 bln — A-(RU).
Credit rating rationale. The issue is a senior unsecured debt instrument of COMPANY “SIMPLE” LLC, a subsidiary of Simple Group. The basis for assigning a credit rating is a public irrevocable offer of the Company. Due to the absence of either structural or contractual subordination of the issue, ACRA regards it as equal to other existing and future unsecured and unsubordinated debt obligations of the Company in terms of priority. In accordance with ACRA’s methodology, the detailed rating approach is applicable, according to which recovery rate on the issue belongs to category II, and therefore the credit rating of the issue is equal to the credit rating of the Company and is set at A-(RU).
REGULATORY DISCLOSURE
The credit ratings have been assigned to Simple Group and the bond issue of COMPANY “SIMPLE” LLC (RU000A10A398) 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 Simple Group under the national scale for the Russian Federation; the Methodology for Assigning Credit Ratings to Financial Instruments on the National Scale for the Russian Federation to determine the credit rating of the bond issue 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.
The credit ratings of Simple Group and the bond issue of COMPANY “SIMPLE” LLC (RU000A10A398) assigned under the national scale for the Russian Federation were published by ACRA for the first time on July 15, 2024 and November 15, 2024, respectively.
The most recent publication date of the credit ratings of Simple Group and the bond issue of COMPANY “SIMPLE” LLC (RU000A10A398) is July 15, 2025.
The credit ratings and the credit rating outlook are expected to be revised within one year.
The credit ratings were assigned based on data provided by Simple Group, information from publicly available sources, and ACRA’s own databases. The rating analysis was performed using the IFRS financial statements of Simple Group as of June 30, 2025.
The credit ratings are solicited and Simple Group participated in the rating process.
In assigning the credit ratings, 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 Simple Group during the year preceding the rating action.
No conflicts of interest were discovered in the course of the rating process.