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March 11, 2008 |
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CILIANDRA PERKASA: Moody's Revises Rating Outlook to Negative Moody's Investors Service has changed to negative from positive the outlook for PT Ciliandra Perkasa's B2 corporate family rating and secured rating on its US$160 million notes. "This rating action follows the announcement of the Corruption Eradication Commission of Indonesia that it will auction several properties in relation to a court case regarding Martias, one of the founders and former shareholders of First Resources Limited," says Wonnie Chu, an Analyst at Moody's. "Three of the assets mentioned are owned by Ciliandra, including PT Ciliandra Perkasa, PT Panca Surya Agrindo and PT Perkasa Intisawit Perkasa," says Chu, adding, "These assets together represent about 25% of Ciliandra's projected EBITDA contribution for 2008 and three out of six of its crushing mills." "Ciliandra's 2008 credit metrics -- Debt/EBITDA of 5x and EBITDA/Int of 2x -- after factoring in the loss of revenue from the three plantations and Moody's conservative palm oil price assumptions, are comparable with other B2 peers," says Chu. "At the same time, Ciliandra's strong liquidity position and long-dated debt maturity profile would support the B2 rating," says Chu. The negative outlook mainly reflects the uncertainties pertaining to Indonesia's legal system and the negative impacts that it could have on Ciliandra's operations and financial position. Moody's will continue to monitor developments and evaluate the resultant rating impact. Established and incorporated in Indonesia in 1992, PT Ciliandra Perkasa is an oil palm upstream operator based in Riau, Sumatera. The company owns 10 operating subsidiaries and affiliates which together own 13 oil palm plantations totaling 80,526 and 54,234 of planted hectares and unplanted hectares respectively as of June 30 2007. The company also has 6 palm oil crushing mills built between 1998 and 2006 with a total annual capacity of 2.1 million tonnes of fresh fruit bunches. Ciliandra is a private company with only one independent commissioner on its board. Through First Resources Limited (95.5% owner of Ciliandra) and PT Fangiono Perkasa Sejati (4.5% owner), the Fangiono family owns directly and indirectly over 70% of the company subsequent to the recent IPO. |
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