...- According to its first half 2023 financial statements, Uzbekneftegaz JSC (UNG) breached some of its financial covenants without obtaining waivers from creditors before the reporting date, which led to an event of default. - Although the waivers were obtained soon after the reporting date and no default ultimately occurred, we believe there are deficiencies in the company's internal controls and risk management, which lead us to lower the stand-alone credit profile on UNG to 'b' from 'b+'. - We also think the weak internal controls may prevent UNG from communicating its need for support to the government in a timely manner, leading us to reassess the likelihood of extraordinary government support to high from extremely high. - We therefore revised the outlook on UNG to negative from stable and affirmed the 'B+' ratings on the company and its debt. - The negative outlook reflects that we could lower the rating on UNG in the next 12 months if continued underperformance, notably at the UzGTL...
