S&P upgrades Rostelecom rating to BB-

MOSCOW, March 28 (RIA Novosti) - International rating agency Standard & Poor's said Tuesday it had raised its long-term corporate credit rating on Rostelecom, Russia's largest long-distance telecommunications services provider, from B+ to BB-, with a stable outlook.

The upgrade reflects the company's strengthened financial profile, the agency said.

S&P credit analyst Lorenzo Sliusarev said, "The upgrade reflects the company's strong financial position, with minimal debt levels; persisting positive free cash flows and sound financial flexibility; its leading nationwide network; and the continuing growth of traffic volumes."

"Standard & Poor's expects that Rostelecom will sustain its limited exposure to financial risk and sound credit protection in the near-to-medium term," he added.

The agency also noted: "ongoing market liberalization and regulatory developments in Russia are expected to cause changes in the competitive environment, translating into pressure on operating performance and profitability. Nevertheless, the company's strong financial profile and ownership of a modern nationwide network should somewhat mitigate this uncertainty, serving as a cushion against potential adverse developments in business performance."