JAKARTA (TheInsiderStories) – Textile producer, PT Sri Rejeki Isman Tbk (IDX: SRIL), also known Sritex, proposed to extends the maturity of the syndicated loan worth of US$350 from 2022 to 2024, said the management. The company have sent the request to the creditors in early November and is expecting the decision will be obtained in February 2021.
Based on the financial report, the issuer raised the loans from Citigroup Global Markets Asia Ltd., DBS Bank Ltd., PT Bank HSBC Indonesia, and The Hongkong and Shanghai Banking Co. Ltd. This year, the manufacturer has a maturing debt of $42 million, which is medium term notes of $40 million short-term debt $2 million.
In 2021, Sritex‘ debt amounting to $33 million to mature. Then, in 2023, around $3 million, in 2024 of $150 million, and in 2025 of $225 million. With the debt problem, the company still optimistic the sales rises 5 – 7 percent from this year’ realization.
The producer also prepared a capital expenditure $55 million to support the target. Until third quarter of 2020, the company recorded sales of $907 million, up 1.34 percent compared to the same period in 2019, which reached $895 million.
The sales were mostly contributed by the spinning segment $360 million, garment segment $250 million, finishing segment $241 million, and the weaving segment $56 million. Sritex‘ net profit rose 2.21 percent from $72.2 million to $73.8 million.
In this month, the company has issued Medium Term Notes worth of $30 million and has been purchased by the state-owned asset management firm, PT Bahana TCW Investment Management. The new debt raised an A+ rating from PT Fitch Ratings Indonesia.
Sritex still has other MTNs which will mature in this year and 2021 with total amount of Rp35 billion. Both have a coupon rate 5.8 percent. The company also obtained a short-term credit facility from PT BPD Jawa Barat and Banten Tbk (IDX: BEKS) with a total limit of Rp550 billion. This credit facility aims to finance the company’ working capital needs and has a one year term.
The garment sales should be largely stable as the company is able to pivot its garment production to other revenue channels, such as the production of masks and medical jumpsuits, which should offset expected declines in its apparel sales.
Sritex’ large cash balance of $168 million at the end of 2019, along with around $102 million of availability under committed credit facilities, will be more than sufficient to cover its upcoming $116 million of debt maturities in 2020. These include $30 million and $10 million of medium term notes due in November and December 2020
In addition, $8 million of scheduled debt repayments and $68 million of short-term working capital loans which Sritex plans to rollover. The company’ Ba3 rating continues to reflect its vertically integrated operations and leading market position among Indonesian textile manufacturers. The ratings also incorporate governance risk arising from the company’s concentrated ownership structure and related party transactions.
The manufacturer based in Central Java, is a vertically integrated manufacturer of yarn, raw fabric, finished fabric and apparel, including uniforms and retail clothing. The company’ operations are spread across 25 factories, consisting of nine spinning plants, three weaving plants, five finishing plants and eight garment plants.
The company’ shares majority owned by the Lukminto family (60.11 percent). Iwan Setiawan Lukminto, son of founder H.M Lukminto, has been the company’ president director since 2006. The family overseas the day-to-day control of operations. The remaining 39.89 percent share of the company is publicly traded on the Indonesian Stock Exchange.
Edited by Staff Editor, Email: email@example.com