PEFINDO has raised its ratings for PT Angkasa Pura II (APIA) and its bonds to idAAA from idAA+
Tuesday, September 12 2023 - 10:33 AM WIB
(September 11, 2023)-- The rating action reflects APIA’s strengthening financial risk profile following the Company’s ability in obtaining IDR2.0 trillion 8-year loans with a grace period until December 2023, for capital expenditure and to refinance its existing debt including maturing Shelf Registered Bond I Year 2018 Serie B of IDR550.0 billion due on December 12, 2023. In addition, APIA also reprofiles its working capital loan that should be mature in 2023 into 5-year loans. We view these initiatives could substantially mitigate its debt refinancing risk to match the potential business recovery.
The upgrade also reflects a rapid recovery rate of its traffic number, with APIA recorded a passenger traffic of 38.7 million in the first half of 2023 (1H2023), or equal to 90% of passenger traffic in the first half of 2019. At the same time, we have also raised our rating for APIA’s outstanding bonds to “idAAA” from “idAA+”. The outlook for the corporate rating is stable.
The corporate rating reflects the strong government support to APIA due to the important role of airports, the Company’s strong competitive position as the nation’s largest airport operator, and its strong profit margin. However, the rating is constrained by exposure to event-driven travel disruptions.
The rating may be lowered if APIA becomes more aggressive in financing its capital expenditures. Reduced financial flexibility in obtaining financing sources may also trigger a rating downgrade. The rating may also be lowered if we view that the government’s commitment to providing support to APIA weakens.
Engaged in airport and airport-related services, APIA operates 20 airports, including Soekarno-Hatta International Airport in Tangerang (Banten), the country’s largest airport and the main gateway, and Kualanamu International Airport in North Sumatra.
As of June 30, 2023, its shareholders were PT Aviasi Pariwisata Indonesia (Persero) (99.99%) and Government of Indonesia (0.00%). (ends)