Thursday, Sep 08, 2005
MARC has assigned a short and long term rating of MARC-2ID/AID to Malaysian AE Models Holdings Berhad’s (“MAE”) proposed issuance of RM200 Million Fully Underwritten Programme Islamic Commercial Paper/Islamic Medium Term Notes. The ratings reflect MAE’s competitive position as a one-stop logistic solutions provider; its technical competency in the industry; stable order book and strong financial profile. These factors are, however, moderated by the competition from low cost manufacturers in China and the company’s exposure to adverse economic factors locally as well as regionally.
MAE is listed on the Main Board of Bursa Malaysia Securities Berhad and its group of companies are involved in providing consulting services, designing, manufacturing, installation and maintenance of automated materials handling and factory automation systems. In line with the company’s expansion, the bulk of the proceeds from the proposed Islamic financing will be used as working capital while the remaining will be utilised toward refinancing existing borrowings particularly the company’s existing Serial Fixed Rate bonds.
Competition from the low cost manufacturers has provided the impetus for the Group to reposition itself as a one-stop automated materials handling system. MAE has as part of its strategy, expanded its marketing efforts outside Malaysia. Presently, MAE has regional offices in China, Indonesia, Thailand and Singapore as well as representatives in Germany and Australia.
MAE’s wide range of automated materials and factory automation systems allow it to cater to the needs of a multitude of industries. As at 31 March 2005, the Group had approximately RM189 million of projects in hand. These contracts include maintenance and technical services contracts that would provide annual recurring income of approximately RM68.5 million per annum for a duration of at least ten years which reinforce the long-term commitment of its customers. By geographical segments, more than 90% of MAE’s current order book is from the overseas markets.
For FY2004, Group revenue increased to RM159.5 million from RM130.8 million in the previous corresponding period. The significant increase was underlined by the continuing contribution from its contract services which recorded an increase of more than 80% following the increase in demand from the overseas markets and increase in sales for bulk handling and contract manufacturing businesses. Consequently, profit before tax rose to RM11.5 million against RM10.6 million in FY2003. For the latest 12-month interim results, revenue increased by 16.7% to RM186.0 million from RM159.5 million in the preceding corresponding period.
MAE’s base case cash flow projections indicate a robust debt service coverage ratio with an average and minimum of 12.8x and 2.6x respectively. Additionally, the relatively high cash balance of RM52.1 million as at 28 February 2005, provides a relatively high degree of financial flexibility to the group as and when it requires additional funds for working capital purposes.
MAE is listed on the Main Board of Bursa Malaysia Securities Berhad and its group of companies are involved in providing consulting services, designing, manufacturing, installation and maintenance of automated materials handling and factory automation systems. In line with the company’s expansion, the bulk of the proceeds from the proposed Islamic financing will be used as working capital while the remaining will be utilised toward refinancing existing borrowings particularly the company’s existing Serial Fixed Rate bonds.
Competition from the low cost manufacturers has provided the impetus for the Group to reposition itself as a one-stop automated materials handling system. MAE has as part of its strategy, expanded its marketing efforts outside Malaysia. Presently, MAE has regional offices in China, Indonesia, Thailand and Singapore as well as representatives in Germany and Australia.
MAE’s wide range of automated materials and factory automation systems allow it to cater to the needs of a multitude of industries. As at 31 March 2005, the Group had approximately RM189 million of projects in hand. These contracts include maintenance and technical services contracts that would provide annual recurring income of approximately RM68.5 million per annum for a duration of at least ten years which reinforce the long-term commitment of its customers. By geographical segments, more than 90% of MAE’s current order book is from the overseas markets.
For FY2004, Group revenue increased to RM159.5 million from RM130.8 million in the previous corresponding period. The significant increase was underlined by the continuing contribution from its contract services which recorded an increase of more than 80% following the increase in demand from the overseas markets and increase in sales for bulk handling and contract manufacturing businesses. Consequently, profit before tax rose to RM11.5 million against RM10.6 million in FY2003. For the latest 12-month interim results, revenue increased by 16.7% to RM186.0 million from RM159.5 million in the preceding corresponding period.
MAE’s base case cash flow projections indicate a robust debt service coverage ratio with an average and minimum of 12.8x and 2.6x respectively. Additionally, the relatively high cash balance of RM52.1 million as at 28 February 2005, provides a relatively high degree of financial flexibility to the group as and when it requires additional funds for working capital purposes.