Thursday, Nov 24, 2005
MARC has reaffirmed the rating of A-(A minus) on Bintang Bulk Mover Sdn Bhd’s (BBM) RM50 million 5-year secured serial bond. This is premised on the Group’s strong operating performance and stable revenue stream, in particular its long term cement transportation contracts with Lafarge Malayan Cement Bhd (LMCB), the largest local cement manufacturer. The affirmation also reflects the Group’s integrated operations through its provision of inland containerized haulage, freight forwarding and motor vehicle transportation. The rating is, however, moderated by BBM’s exposure to the cyclical development inherent in the cement industry and intense competition within the general haulage industry.
For FY2005, the Group’s revenue increased significantly by 27.6% to RM114.3 million. This was contributed mainly by the container haulage services, the bulk of which was generated by its subsidiary, Agenda Wira Sdn Bhd. In tandem with its revenue growth, the Group recorded higher pre-tax profit of RM16.3 million (FY2004: RM15.5 million). Given the strengthening domestic economic environment and resilient export activities, the haulage volume is anticipated to remain buoyant. Approximately 45.2% of the Group’s total revenue came from the cement transportation, of which the LMCB contract contributed 37.4% compared to the container haulage services with 46.4% in fiscal 2005.
The Group expects to post a revenue growth of 9.3% and 22% for FY2006 and FY2007 respectively. The Group’s cement haulage activities are expected to continue to support revenue and profitability levels based on the long term contract while increasing contribution is expected from the container haulage activities. Other income would be derived from additional services such as vehicle transportation activity, which is likely to expand further, in tandem with the active motor vehicle industry. Moving forward, the Group will be positioning itself as an integrated logistic provider, providing additional services such as warehousing and forwarding services, which are expected to be offered in fiscal 2006.
Debt leverage position increased to 1.55x in FY2005 mainly due to the issuance of RM50.0 million long term serial bonds in April 2004. However, the debt-to-equity level is still within the covenanted level of 2.0 times stated under the issue structure for the first two years upon drawdown of the facility.
The Group’s CFO interest and debt coverage ratios have shown improvement compared to FY2004. It is expected that BBM’s cash flow position will continue to be supported by the income stream from its long term contracts mainly with LMCB.
BBM’s extensive fleet of tankers, prime movers and trucks have transformed the Group into one of the largest second tier hauliers in the country. Operations are supported by several operation centres spread across West Malaysia which provide logistical support and marketing services. With its niche position in the transportation of bulk cement and proven track record of reliability and improving efficiency, BBM is well positioned to compete effectively in the intensely competitive domestic haulage industry.
For FY2005, the Group’s revenue increased significantly by 27.6% to RM114.3 million. This was contributed mainly by the container haulage services, the bulk of which was generated by its subsidiary, Agenda Wira Sdn Bhd. In tandem with its revenue growth, the Group recorded higher pre-tax profit of RM16.3 million (FY2004: RM15.5 million). Given the strengthening domestic economic environment and resilient export activities, the haulage volume is anticipated to remain buoyant. Approximately 45.2% of the Group’s total revenue came from the cement transportation, of which the LMCB contract contributed 37.4% compared to the container haulage services with 46.4% in fiscal 2005.
The Group expects to post a revenue growth of 9.3% and 22% for FY2006 and FY2007 respectively. The Group’s cement haulage activities are expected to continue to support revenue and profitability levels based on the long term contract while increasing contribution is expected from the container haulage activities. Other income would be derived from additional services such as vehicle transportation activity, which is likely to expand further, in tandem with the active motor vehicle industry. Moving forward, the Group will be positioning itself as an integrated logistic provider, providing additional services such as warehousing and forwarding services, which are expected to be offered in fiscal 2006.
Debt leverage position increased to 1.55x in FY2005 mainly due to the issuance of RM50.0 million long term serial bonds in April 2004. However, the debt-to-equity level is still within the covenanted level of 2.0 times stated under the issue structure for the first two years upon drawdown of the facility.
The Group’s CFO interest and debt coverage ratios have shown improvement compared to FY2004. It is expected that BBM’s cash flow position will continue to be supported by the income stream from its long term contracts mainly with LMCB.
BBM’s extensive fleet of tankers, prime movers and trucks have transformed the Group into one of the largest second tier hauliers in the country. Operations are supported by several operation centres spread across West Malaysia which provide logistical support and marketing services. With its niche position in the transportation of bulk cement and proven track record of reliability and improving efficiency, BBM is well positioned to compete effectively in the intensely competitive domestic haulage industry.