Scope Ratings GmbH (Scope) monitors and reviews its credit ratings on an ongoing basis and at least annually, or every six months in the cases of sovereigns, sub-sovereigns and supranational organisations that may act as a lender of last resort.

Scope performs monitoring reviews to determine whether material changes and/or changes in macro-economic or financial-market conditions could have an impact on the credit ratings. Scope considers all available and relevant information when undertaking the monitoring review.

Monitoring reviews are conducted by performing a peer comparison, benchmarking against the rating-change drivers, and/or reviewing the credit rating’s performance over time, as deemed appropriate by the Lead Analyst or Analytical Team Head, in addition to an assessment of all aspects of the relevant methodologies, including key rating assumptions and model(s). Scope announces the result of each monitoring review on its website and/or on its subscription platform ScopeOne.

Scope completed the monitoring review for Duna Aszfalt Zrt. (issuer rating: BB-/Stable, senior unsecured debt rating: BB-) on 30 January 2026.

This monitoring note does not constitute a credit-rating action, nor does it indicate the likelihood that Scope will conduct a credit-rating action in the short term. Information about the latest credit-rating action connected with this monitoring note along with the associated ratings history can be found on scoperatings.com.

Key rating factors

Duna Aszfalt’s BB-/Stable issuer rating is supported by its improved business setup, primarily due to enhanced geographical diversification, which has offset the impact of a substantial increase in gross debt. This trend is expected to continue due to Duna’s growth in Africa.

The company's geographical diversification in Central and Eastern Europe has improved significantly following the acquisition of Mota-Engil Central Europe in Poland in Q3 2024 (now Duna Polska), as well as bolt-on acquisitions in Romania and the Czech Republic (Eurostrada and VALCANO) in 2025. Consequently, Scope anticipates that the revenue contribution from non-domestic revenues will surpass 20% (9M 2025: 18%). This is complemented by a strong track record of winning tenders and a robust order backlog covering around 3.3 years of revenues, which supports medium-term topline visibility.

However, these strengths are offset by structural concentration risks. The group remains focused on local industrial and civil engineering projects, which are in a highly cyclical segment with low barriers to entry. There is also revenue concentration in building and motorway construction. The business model is highly dependent on government tenders. Duna’s strong positioning in projects with state-owned entities exposes it to regulatory and reputational risks (ESG factor: credit-negative).

Duna Aszfalt’s financial risk profile is driven by Scope’s expectation of increasing leverage to a range of 3.0x–3.5x Scope-adjusted debt/EBITDA* (compared to 1.6x in 2024) and a decline in the funds from operations/debt to around 20%–25% (2024: 61%), due to debt-funded investments (notably the GED Africa toll road project). However, this increase in leverage is offset by strong EBITDA interest coverage, which Scope forecasts to remain above 7x, as well as robust liquidity. These factors mitigate the impact of more volatile free operating cash flow, stemming from reduced profitability, a more concentrated backlog and execution risks.

The Stable Outlook reflects Scope’s expectation that the issuer can successfully integrate Duna Polska’s operations, and that credit metrics will remain at levels commensurate with the assigned rating. This includes debt/EBITDA below 3.5x and EBITDA interest coverage above 7x, considering a substantial increase in gross debt. This is because the company will utilise its balance sheet headroom after a long history of being under-leveraged and despite increased volatility in cash generation due to i) the chunky order backlog; ii) potential changes in Duna's competitive environment; and iii) declining operating profitability, with acquired companies diluting the currently good EBITDA margin. The Outlook further reflects the expectation that the African project will be delivered on time and within budget, however, with no operational cash flow from it in the forecast horizon.

The upside scenario for the ratings and Outlook is:

1. Significantly improved diversification of the order book by customers, segments, geographies and projects as well as debt/EBITDA maintained below 3.0x (remote scenario)

The downside scenarios for the ratings and Outlook are (individually):

1. Debt/EBITDA of above 3.5x on a sustained basis
    
2. Reduced visibility of cash flow from European activities, as evidenced by a backlog of below 2x

The rating for the senior unsecured debt category (BB-, in line with the issuer rating) reflects an average recovery, driven by significant secured debt that ranks ahead the unsecured debt. There is also a risk that the proportion of senior secured debt will increase if the issuer’s credit quality deteriorates, due to volatility in the capital structure.

*All credit metrics refer to Scope-adjusted figures.

The methodologies applicable for the reviewed ratings and rating Outlooks (General Corporate Rating Methodology, 14 February 2025; Construction and Construction Materials Rating Methodology, 23 January 2026) are available on scoperatings.com/governance-and-policies/rating-governance/methodologies.
This monitoring note is issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0.
Lead analyst: Philipp Wass, Managing Director

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