Wednesday, Dec 21, 2005
MARC has assigned ratings of MARC-1ID/A+ID to Nam Fatt Corporation Berhad’s (Nam Fatt) RM250 million Islamic Commercial Paper/Islamic Medium Term Notes (ICP/IMTN) Programme. The ratings reflect a tight issue structure with pre-determined criteria of contracts that could be financed by the said facility and in turn proceeds from the contracts will be used to repay any outstanding notes before operating expenditures. This structural element enhances the credit strength of Nam Fatt, whom with commendable competitive position in the construction and engineering business underscored by the sizeable outstanding order book; good operating track record and improving financial profile.
Nam Fatt, which is listed on the Main Board of Bursa Malaysia Securities Berhad, currently has two core businesses namely construction & engineering and property development & leisure. In rationalising its businesses into the two core business areas, Nam Fatt has disposed its industrial boiler manufacturing company, the main company under the manufacturing division and has regrouped the remaining two manufacturing companies under the construction & engineering division as both companies are involved in the manufacturing and installing of roofing materials. As for the leisure division, it has been categorized under property development together with its other property development project, the Kesuma Lakes development, since the division is primarily involved in constructing and developing golf courses and the high-end residential development surrounding the golf courses like the Sultan Abdul Aziz Shah Golf Club in Shah Alam.
Nam Fatt, thus far, has completed various projects for the Government, PETRONAS-related companies, and Putrajaya and has steadily build-up its order book from RM467 million in FY1999 to RM1.0 billion as at 31 May 2005 which is expected to be completed over the next 2 to 3 years. Among the notable on-going projects are the RM684 million contract to construct pumping facilities for Petrodar Operating Company Ltd (in which PETRONAS and China National Petroleum Company have majority stakes) and RM548.8 million contract to construct the Integrated Customs, Immigration and Quarantine Complex in Johor for Gerbang Perdana Sdn Bhd.
Nam Fatt’s revenue trend for the past financial years was mixed with growth declining from FY1999 to FY2001, before registering a steady climb in FY2002 and FY2003. Revenue had grown at a compounded annual growth rate (CAGR) of 27.9% since FY2001. Pre-tax profit grew year-on-year since 1999, with the exception of FY2001, with a CAGR of 73.5%. For FY2003, pre-tax profit more than doubled following the waiver of scheme borrowings of RM47.4 million under the Group’s Debt Restructuring Scheme (DRS) completed in July 2003. Going forward, the Group’s outstanding order book of RM1.0 billion should sustain its revenue and profit over the next two to three financial years.
In terms of cash flow protection, the Group had forecasted a minimum and average DSCR of 1.5 times and 7.4 times respectively over the tenure of the facilities. As for the pro-forma debt-to-equity ratio, it is expected to be 0.91 times.
Nam Fatt, which is listed on the Main Board of Bursa Malaysia Securities Berhad, currently has two core businesses namely construction & engineering and property development & leisure. In rationalising its businesses into the two core business areas, Nam Fatt has disposed its industrial boiler manufacturing company, the main company under the manufacturing division and has regrouped the remaining two manufacturing companies under the construction & engineering division as both companies are involved in the manufacturing and installing of roofing materials. As for the leisure division, it has been categorized under property development together with its other property development project, the Kesuma Lakes development, since the division is primarily involved in constructing and developing golf courses and the high-end residential development surrounding the golf courses like the Sultan Abdul Aziz Shah Golf Club in Shah Alam.
Nam Fatt, thus far, has completed various projects for the Government, PETRONAS-related companies, and Putrajaya and has steadily build-up its order book from RM467 million in FY1999 to RM1.0 billion as at 31 May 2005 which is expected to be completed over the next 2 to 3 years. Among the notable on-going projects are the RM684 million contract to construct pumping facilities for Petrodar Operating Company Ltd (in which PETRONAS and China National Petroleum Company have majority stakes) and RM548.8 million contract to construct the Integrated Customs, Immigration and Quarantine Complex in Johor for Gerbang Perdana Sdn Bhd.
Nam Fatt’s revenue trend for the past financial years was mixed with growth declining from FY1999 to FY2001, before registering a steady climb in FY2002 and FY2003. Revenue had grown at a compounded annual growth rate (CAGR) of 27.9% since FY2001. Pre-tax profit grew year-on-year since 1999, with the exception of FY2001, with a CAGR of 73.5%. For FY2003, pre-tax profit more than doubled following the waiver of scheme borrowings of RM47.4 million under the Group’s Debt Restructuring Scheme (DRS) completed in July 2003. Going forward, the Group’s outstanding order book of RM1.0 billion should sustain its revenue and profit over the next two to three financial years.
In terms of cash flow protection, the Group had forecasted a minimum and average DSCR of 1.5 times and 7.4 times respectively over the tenure of the facilities. As for the pro-forma debt-to-equity ratio, it is expected to be 0.91 times.