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Scope upgrades Pannon-Work issuer rating to B+ from B

Ratings

Ratings on Tuesday said it upgraded the issuer rating of Hungarian staffing company Pannon-Work to B+ from B with a stable outlook, according to a report by state news wire MTI.

Scope also upgraded the rating on a senior unsecured HUF 3.48bn bond Pannon-Work issued in the framework of the Bond Funding for Growth Scheme (BGS) of the National Bank of Hungary (MNB) in October 2020 to BB- from B+.

The agency said the rating action reflects Pannon-Work's acquisition of ten solar parks with a combined capacity of 5MW "with excellent cash flow generation potential", the acquisition of payroll services company HR-Face and "an increasing margin despite the pandemic".

"Pannon-Work’s business risk profile...is driven by its position as the fourth largest personnel service provider in Hungary operating in a very fragmented market as well as diversification into payroll services and renewables," Scope said.

"The company's business risk profile is constrained by weak geographical and client diversification," it added.

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