ZENERGIA S.R.L. Corporate Credit Rating (Affirm)

modefinance published the review of the Solicited Corporate Credit Rating of ZENERGIA S.R.L. on its CRA website, and the rating assigned to the entity is B1 (Affirm). The analysis confirmed the Company has average capability of repaying financial obligations and it is little affected by adverse economic scenarios.

ZENERGIA S.R.L. has been established in 2009 by Damiano Balzarini, owner and manager of the company. The firm is engaged in the trade of electricity and during 2021 it started the activity of trading in natural gas.

The Company has been active in the sector over the past 10 years, and can also rely upon the experience of its director who has acquired considerable know-how in the reference market. In the last year, the Company has significantly increased its dispatching activity in the withdrawal and transport of electricity, also expanding the business to the wholesale trading of natural gas. No black record was found related to the Company.

The company has a single-person administrative body and, although its small size, it now appears necessary to increase roles and responsibilities as well as to include a supervisory body.

During 2020, the Company recorded a significant increase in sales revenues (+ 109%) which enabled the Company to remain in line with previous years in terms of profitability. There is a significant increase in the Company's turnover which leads to an increase in operating receivables and payables, thus worsening both solvency (increase in leverage) and liquidity (worsening of the monetary cycle). Nonetheless, the Company still remains at a sufficient level. The cash flow analysis shows a positive change in 2020, with final cash and cash equivalents of 450 thousand euros, thanks to the cash inflows related to the sale of Zestate Srl, previously wholly owned by Zenergia Srl. The administrator must pay attention to the collection of receivables from customers, which in 2020 increased significantly. The company used 2 self-liquidating lines, one of these untapped and closed in February 2020. Zenergia Srl used one line entirely, but no important assessments are made in this regard.

The analysis of the Central Credit Register’s report is positive.

The Company has improved in terms of size and is excellent positioned compared to the reference peer group. Both profitability and solvency need to be improved and are below the median value of the peer group. However, the absence of financial debt is positive. The trend of the sector shows an adequate level in all the considered areas. During 2020 there was a significant drop in consumption, due to the closure of economic activities. Such trend changed in 2021, due to the recovery in activity, as also evidenced by more positive growth estimates. In 2021, with the resumption of activities and due to the sharp rise in the prices of CO2 permits, energy prices increased significantly. Zenergia Srl is not expected to be impacted by this price increase, as it has fixed agreements and margins, so sales revenues and operating margins are expected to increase steadily.

Finally, the Italian macroeconomic situation shows how the economy, already weak before the current health crisis, was significantly affected by the emergency during 2020, although already showing first signs of recovery during the current year. Strict compliance with the government agenda, the maintenance of political stability and the consequent limited uncertainty for citizens and businesses, could lead Italy to recover in a short period of time.

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 (credit risk software). 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 – Eva Vocci (Rating Analyst)
eva.vocci@modefinance.com
+39 040 3756740

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