S&P affirms Antam's rating

Standard and Poor's rating service on Thursday affirmed its 'B' rating on Indonesian mining company, PT Aneka Tambang Tbk, and gave its outlook as stable.

The rating agency said that Antam's weak financial profile, material country risks, regulatory uncertainty, and increasing cost profile were constraining its rating.

"Offsetting these risks are the favorable outlook for nickel and gold prices over the medium term and Antam's vertically integrated operations," said Standard and Poor's credit analyst Erly Witoyo.

Antam is a mining company with interest in nickel, gold, silver, bauxite, and iron sands operations. In 2003, the company generated revenues of Rp2.1 trillion (approximately US$250 million) from its operations, all of them in Indonesia.

A lack of new investments in nickel production, low inventory levels, and strong demand growth are expected to result in a nickel supply deficit up to 2006, the agency said. (*)