BORGOSESIA S.P.A. Corporate Credit Rating (First Issuance)

modefinance published the Solicited Corporate Credit Rating of BORGOSESIA S.P.A. on its CRA website, and the rating assigned to the entity is B1 (first issuance).

The analysis revealed the company has average capabilities of repaying financial obligations. Possibile adverse macroeconomic conditions, different management or strategies might impact on the capability of repaying debt.

BORGOSESIA S.P.A. is a joint stock company listed on Mercato Telematico Azionario of Borsa Italiana. It operates on investments and their management on behalf of third party. The Company was founded in 1873 as textile firm and it has changed several ownerships during its history. BORGOSESIA S.P.A. is a group composed by two different divisions: BORGOSESIA REAL ESTATE, with focus on real estate investment, and BORGOSESIA ALTERNATIVE, operative on financial instruments investments.

BORGOSESIA S.P.A. shows an adequate economic and financial situation, characterized by proper solvency ratios, which are aligned with the sector. Also, the coverage ratio is adequate, although the high level of current liabilities. Thanks to an increase in margins, the company’s profitability ratios are also growing.

The Company manages its credit lines properly, tapping especially into loans.

The Company’s stocks have suffered from a volatile trend in the last year, but at the end of the period, stock’s price has risen again. Most of the Company’s shares are listed, while the main shareholder is the company DAMA S.R.L., which holds 20.81% of shares.

The Company holds numerous equity investments, consistent with its nature as a holding company. The Company is administrated by a Board of Directors, flanked by a Board of Auditors and an external auditing company.

The sector’s solvency and profitability indicators are good and characterized by a constantly growing trend over the last four years. In the same period, the Company recorded adequate and better solvency and profitability indicators than the peer group.

The ongoing pandemic and the consequent economic losses lead to a contraction of GDP and jobs, affecting any company, regardless the political and economic measures undertaken by the Government.

In the following table, the addressing factors, actions or events that could lead to an upgrade or a downgrade are summarized:

The present Corporate Credit rating is issued by modefinance under EU Regulation N. 1060/2009 and following amendments.

The present rating is solicited, and based on both private and public information. The rated entity and/or related third parties have provided all private information used. modefinance had access to some accounts and other relevant internal documents of the rated entity and/or related third parties. Solicited and unsolicited ratings issued by modefinance are of comparable quality, as the solicitation status has no effect on methodologies used. More comprehensive information on modefinance Corporate Credit Ratings are available here.

The present Corporate Credit Rating is issued on MORE Methodology 2.0 and Rating Methodology 1.0. A comprehensive description of both methodologies, as well as information on modefinance Rating Scale and Mappings, is available here. For information on historical default rates of modefinance Corporate Credit Ratings please refer to ESMA Central Repository and ESMA European Rating Platform.

modefinance refers to default as a company under bankruptcy, or under liquidation status, or under administration or for which missed payments on a financial obligation are officially recorded.

The quality of the information available on the rated entity and used to determine the present rating was judged by modefinance as satisfactory. Please note that modefinance does not perform any audit activity and is not in a position to guarantee the accuracy of any information used and/or reported in the present document. As such, modefinance can accept no liability whatsoever for actions taken based on any information that may subsequently prove to be incorrect.

The present credit rating was notified to the rated entity in order to identify potential factual errors, as prescribed by the CRA Regulation.

No amendments were applied after the notification process.

The rated entity is not a buyer of ancillary services provided by modefinance.

The rating action issued by modefinance was performed independently. The analysts, members of the rating team involved in the process, modefinance Srl and its members and shareholders do not have any conflicts of interest in relation to the Rated Entity and/or Related Third Parties. If in the future a potential conflict of interest is identified in relation to the persons reported above, modefinance Ratings will provide the appropriate information and if necessary the rating will be withdrawn.

The present Credit Rating is an opinion of the general creditworthiness that modefinance issues on the rated entity, and should be relied upon to a limited degree. The issued rating is subject to an ongoing monitoring until withdrawal.

Head Analyst – Christian Raimondo (Rating Analyst)
christian.raimondo@modefinance.com
+39 040 3756740

Assistant Analyst – Stefania Latin (Rating Analyst)
stefania.latin@modefinance.com
+39 040 3756740

Responsible for Rating Approval – Pinar Dilek (Rating Process Manager)
pinar.dilek@modefinance.com
+39 040 3756740