Public Joint Stock Aeroflot Russian Airlines : Fitch international ratings agency maintains Aeroflot's long-term credit rating at «ВВ-» level

02 November 2020

Moscow, 2 November 2020 - The international ratings agency Fitch Ratings has maintained its credit rating for PJSC Aeroflot at the level of 'BB-', keeping its outlook at 'negative' level.

The agency noted that despite 'uncertainty around demand and financial-profile recovery', which reflects agency's view on the global air transportation industry and explains maintained negative outlook, 'new equity proceeds and other state support measures boosting liquidity'. The agency notes that Aeroflot Group's 'liquidity will remain sufficient to sustain operations in 2020-2021, assuming recent substantial government support and measures to preserve cash'.

Fitch separately noted recovery of Russian domestic market as well as strong indicators of the Group in this segment from June 2020 and mentioned that domestic air traffic 'substantially improved in August-September 2020'. The agency expects that unlike passenger traffic of EMEA (Europe, Middle East and Africa) carriers 'Aeroflot's recovery will be facilitated by a large share of traffic in the domestic market and low travel penetration in Russia'.

Andrey Chikhanchin, Deputy CEO for Commerce and Finance at Aeroflot, commented on Fitch Ratings' decision:

'Maintaining Aeroflot's credit rating reflects significant effort made by the company to improve its liquidity position by maximizing cost savings, economically prudent capacity management approach on the back of Russian transportation market recovery, and raising both equity and debt capital. Undoubtedly, an important contribution to improving the liquidity situation was provided by targeted government support, which included government guarantees for loans, approval and participation in the share capital increase, which also made it possible to attract capital from a wide range of Russian and international investors. Despite the difficult situation in the air transportation industry, maintaining Aeroflot's credit rating by Fitch international ratings agency once again confirms the company's stable credit position for our partners'.