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March 17 (The following statement was released by the rating agency)
Fitch Ratings has affirmed the Issuer Default Rating Long-Term Rating (IDR) of PT Tower
Bersama Infrastructure Tbk (TBI) at 'BB'. At the same time, Fitch has
affirmed the National Long-Term rating at 'AA-(idn)'. Outlook is
stable. A complete list of the rating actions can be found in section
Fitch mengafirmasi level although FFO-adjusted net leverage Tower Co
remain above 4.0x, the mold in which the action of the negative fractions can
considered. FFO adjusted net leverage was 5.4x Mutual Tower at the end of
December 2013, due to high debt to fund the development of a tower
in the year 2013. However, Fitch estimates that leverage will fall below
mold negative staging action in the medium term due to the increase in current
cash from long-term contracts with EBITDA margins above 80%. the risk of
high leverage also be balanced with a strong customer portfolio
with a higher proportion of operators who have the
National ranking in the category of 'AA' indicates the expectation would risk failure
very low pay relative to other issuers or securities in
Indonesia. Credit risk is only slightly different from issuers or
debt securities that are rated the highest in Indonesia.
Factors Fueling Rating
Maintain Growth The High Leverage: Leverage of Tower Bersama in 2013
remains high due to the high debt to finance the construction of new minarets
for some operators, especially PT Telekomunikasi Cellular
(Telkomsel, BBB / Stable). Construction of the new tower of Tower Bersama reach
peak in 2013 with the construction of a new tower 1,800 (2012: 1,144).
Fitch estimates that leverage will remain above the reference action
negative ranking of 4.0x in 2014 and 2015. However, Fitch expects
that it would not be sustainable and FFO-adjusted net leverage will fall
below 4.0x in 2016.
Decline Slows Acquisition Leverage: As a provider of telecommunication towers
second largest in Indonesia measured from the number of towers, Tower Bersama has
limited options to acquire a portfolio of smaller towers
another provider of telecommunication towers. However, the acquisition of the tower
Significant could happen if such operator PT Telekomunikasi Indonesia Tbk
(BBB-/Stabil), PT Indosat Tbk (BBB / Stable) and PT XL Axiata Tbk (XL, BBB /
Stable) decided to sell their tower portfolio. Fitch estimates that
acquisition will further slow the decline in leverage from Fitch estimates
now and provide negative pressure on the ratings.
Its Improved composition Renters: renters portfolio composition of Tower Bersama
improved the revenue contribution from telecom operators
are rated investment-grade rose to 75% in 2013 from 70% in 2012.
Improved quality tenants offset the high leverage of the company.
The company has the same rank with the provider of telecommunication towers
in Indonesia, PT Professional Telekomunikasi Indonesia (Protelindo,
BB / Stable), which has a FFO-adjusted net leverage below 4.0x but
obtain less than 50% of its revenue from telecom operators
Although Tower Bersama continue to face the risk of the operator ekposurnya
CDMA is experiencing many difficulties, Fitch estimates that the composition
tenants will tend to improve with more contributions from operators
rated investment-grade because they will continue to make investments to
expanding the network. Fitch also estimates that the contribution of the operator
rated investment-grade telecommunications will rise more than 75% after XL
completed the acquisition of PT Axis Telekom Indonesia in March
Solid Margin: Tower Bersama rating is supported by profitability
solid and income supported by long-term contracts are not
can be canceled. Tower Bersama recorded EBITDA margin of 81.9% in 2013,
rose from 81.5% in 2012. The cash flows of the company also has a level
high predictability of the revenue that has been recorded by
USD1.9 billion at the end of September 2013, with an average of 7.3 during the contract period
Access to Funding Strong: Liquidity is also supported from Tower Bersama
by strong access to bank loans with USD262 million capital facilities
work that has not been used. The company also has a track record in the market
bonds with the issuance of local currency bonds and currency bonds
foreign. The company plans to replace the guaranteed debt at the level of
operating company with debt that is not guaranteed at the company level
holding. In addition, the company also plans to minimize exposure
against foreign currencies has debt in local currency.
Can be Managed Currency Exposure: Tower Bersama has approximately USD887 million
debt in foreign currency, approximately 81% of the total debt. more than
90% of corporate debt is protected by a combination of hedging and hedging contracts
natural annual revenue of $ 40 million (18% of total revenue).
The Company recorded a IDR854 billion (USD75 million) in cash (which includes cash
limited) at the end of December 2013 in which USD56 million is saved in U.S. dollars.
Fitch does not expect the ratings of positive action will occur in the
medium term because of the company's leverage will remain high.
Negative: future developments that may, individually or
collective downgrade include:
- Acquisition of the tower portfolio funded by debt or default of
weaker telecom operators resulting FFO-adjusted net
leverage is above 4.0x on an ongoing basis
- The fall in revenues from telecom operators rated
investment-grade below 50%
- Genesis which led Fitch to revise perkiraanya so Fitch
no longer estimate FCF of the company will be positive in 2015.
A complete list of the rating actions:
Rating Long-Term Foreign Currency USD affirmed at 'BB'; Outlook Stable
Rating Long-Term Local Currency USD affirmed at 'BB'; Outlook Stable
Long-Term National Rating affirmed at 'AA-(idn); Outlook Stable
Senior Rating Foreign Currency Not Guaranteed at 'BB'
USD300 million senior unsecured bonds issued by TBG Global Pte
Ltd. is affirmed at 'BB'
Senior National Rating Not Guaranteed affirmed at 'AA-(idn)'
IDR4 trillion continuous bond program affirmed at 'AA-(idn)'
IDR740 billion bonds issued in the first phase under the bond program
sustained above affirmed at 'AA-(idn)'