Aug 7, 2011

Apexindo outlook rating revised to stable

PT Pemeringkat Efek Indonesia (Pefindo) revised the outlook of the corporate rating of PT Apexindo Pratama Duta Tbk to stable from negative. 
The revision is mainly triggered by the company’s ability to refinance its expensive debt with a lower cost borrowing which will lead to a significant improvement in cash flow protection measures. This also reflects that the debt restructuring process at PT Mitra International Resources Tbk (MIRA or the Group) now has lesser impact to the Company’s fund raising capability.
At the same time, the company’s corporate and Bond II/2009 ratings are affirmed at idA. The ratings reflect the Company’s strong market position in the region, high profit margin from offshore rig, and favorable rig profile. 
However, the ratings are constrained by the company’s concentrated customer and revenue source, limited financial support from the group, and aggressive capital structure.
APEX is the largest domestic drilling contractor, operating 14 rigs (6 offshore rigs and 8 onshore rigs). In November 2008, MIRA acquired a majority stake of APEX from PT Medco Energy International Tbk. 
Now, the group through Mira International Holdings Pte Ltd (MIH) controls about 98.1% of APEX’s shares. PT Hertech Kharisma and public respectively hold the remaining shares of 1.6% and 0.3%.

Disclosure: No position at the stock mentioned above.

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