Fitch Ratings assigned national rating for PKN ORLEN

Polski Koncern Naftowy ORLEN S.A. ("PKN ORLEN", “Company”), informs that, on 30 August 2012 Fitch Ratings (“Agency”) has assigned PKN ORLEN a national long-term rating of “BBB+(pol)” with a positive outlook. Moreover the Agency has changed the outlook of long-term international rating from stable („BB+/stable outlook”) to positive („BB+/positive outlook”). The Agency has also affirmed short-term international  rating for PKN ORLEN at “B” level.

Fitch Ratings justifies the change of rating perspective for PKN ORLEN by the better Company’s financial profile thanks to measures taken to reduce leverage, including the disposal of Polkomtel shares, modest capex in 2011-2012 in comparison to a capex-intensive period until 2010 and no dividends paid in 2011-2012. These operations support PKN ORLEN creditworthiness in the still difficult conditions for the European refining sector. Despite improvement of refining margin since April 2012, the Agency expects refining margin to weaken in the remainder of the year.

Fitch Ratings believes that the Company has much greater financial flexibility to reduce its capex in case of weaker cash flows now than in 2008-2010 when PKN ORLEN had signed significant investment liabilities. The Agency positively views PKN ORLEN ability to manage its working capital changes in line with changes in its financial position. This could provide additional flexibility for the Company in case credit ratios approaching the covenant level in loan agreements, for instance due to weakening of the industry conditions.

Fitch Ratings, in its statement, indicates that Company’s international long-term rating may be upgraded to “BBB-“ in the next 12-24 months should PKN ORLEN consistently maintain credit ratios at a moderate level. According to the Agency the future leverage level will partly depend on the planned strategy update and macroeconomic conditions of refining and petrochemicals operations in the medium term.

See also regulatory announcement no 22/2009 dated 2 march 2009.