Press Releases / 26.06.2014

Press Release as of 26.06.2014

JSFC "Sistema Mass-media"

CJSC AK&M Rating Agency upgraded the national scale credit rating of Sistema Mass-media JSC (hereinafter called the 'Company') to 'A' (tier 3), with a stable outlook.

CJSC AK&M Rating Agency upgraded the national scale credit rating of Sistema Mass-media JSC (hereinafter called the 'Company') to 'A' (tier 3), with a stable outlook.


The Company's previous rating was 'B++', with a positive outlook.

The progress from a positive outlook on the Company's rating to a positive rating action results from balance sheet improvements and higher performance indicators in 2013. We primarily appreciate the Company's lower debt burden and positive financial result (in 2013, SMM earned $86.7 million in revenues, its net profit amounted to $0.5 million (unadjusted for the performance of Stream LLC which is not part of SMM's ownership structure).

Since 2011, the Company's relative debt load represented by the net debt to EBITDA multiple has decreased almost 3 times being equal to 0.8x as of January 1, 2014, which is comfortably low.

At the same time, we regard the moderately low net asset value as well as relatively imbalanced current assets and short-term liabilities as negatve rating drivers.

It should be highlighted that the major fluctuations of operating earnings over a year's period due to a specific character of the media business have a negative impact on the Company's financial stability.


Sistema Mass-media JSC managing JSFC Sistema's media assets is one of the largest Russian players in the market of content for pay television networks and other media resources. The company specializes in the production, aggregation and distribution of content for various platforms.

SMM owns and manages CJSC STREAM Television Company (content production, aggregation, and distribution), CJSC Russian World Studios and United Russian Studios JSC (movies and television content), Maxima Communication Group (advertising), and Digital Television Broadcasting LLC (TV broadcasting in the automobile television segment). The auditor of SMM JSC is CJSC Audit-Garantia-M, a member of the self-regulatory audit organization Audit Chamber of Russia (non-profit partnership), primary registration number (ORNZ) 10203001727.


This press release is based on the Statement of assignment of a credit rating to  Sistema Mass-media.

The credit rating, along with any information and conclusions provided in this press release, only conveys our opinion on the Company's creditworthiness and shall not be construed as a recommendation to purchase or sell securities, or to lend funds.

AK&M Rating Agency shall not be held liable for any interpretations, inferences and consequences related to the application of results of the rating estimation procedure by any third parties.

CJSC AK&M Rating Agency is a leading independent national rating agency engaged in rating activities since 1993. CJSC AK&M Rating Agency is accredited by the Ministry of Finance of the Russian Federation (order no. 452 as of September 17, 2010) and is on the Central Bank of Russia's Register of Accredited Rating Agencies.


CJSC AK&M Rating Agency

ul. Gubkina 3, Moscow, Russia

Phone no. (495) 916-70-30, fax no.: (499) 132-69-18.