Friday, Mar 03, 2006
MARC has reaffirmed the rating of Land & General Berhad’s (L&G) Redeemable Convertible Secured Loan Stocks (RCSLS) of up to RM320,962,637 at B- (B minus). The rating reflects the Group’s weak competitive position following the on-going corporate restructuring and de-gearing exercise, weak financial performance, impaired cash generation ability and high debt burden.
Following L&G’s restructuring scheme, the Group is now purely a property company following its exit from the timber business with the disposal of its 51% equity interest in Overseas and General Limited (OGL). On the property front, township developments with respect to its Bandar Sungai Buaya and Lembah Beringin projects have been poor. For Bandar Sri Damansara new launches of properties have been limited. Funds for interest servicing and redemption of the RCSLS will be from the proceeds from an asset disposal plan to be executed over the tenure of the RCSLS.
Group revenue continued to slide further brought about by the limited new property launches and high operational and finance costs. L&G has been focused on its restructuring scheme where considerable time and efforts were committed on the sale of assets. L&G’s long term future profitability and ongoing viability depends primarily on the combination of a successful implementation of the debt restructuring scheme and a turnaround in the company’s performance.
Following L&G’s restructuring scheme, the Group is now purely a property company following its exit from the timber business with the disposal of its 51% equity interest in Overseas and General Limited (OGL). On the property front, township developments with respect to its Bandar Sungai Buaya and Lembah Beringin projects have been poor. For Bandar Sri Damansara new launches of properties have been limited. Funds for interest servicing and redemption of the RCSLS will be from the proceeds from an asset disposal plan to be executed over the tenure of the RCSLS.
Group revenue continued to slide further brought about by the limited new property launches and high operational and finance costs. L&G has been focused on its restructuring scheme where considerable time and efforts were committed on the sale of assets. L&G’s long term future profitability and ongoing viability depends primarily on the combination of a successful implementation of the debt restructuring scheme and a turnaround in the company’s performance.