Cahya Mata Sarawak’s Ratings Reaffirmed at AA3/Stable: RAM Ratings

RAM Ratings (RAM) has reaffirmed Cahya Mata Sarawak’s (CMS) MYR 2 billion Islamic Medium-Term Note (MTN) Programme’s (2017/2037) AA3/Stable rating and the AA3/Stable/P1 corporate credit ratings. RAM’s decision to reaffirm ratings was led by CMS’ standing as sole cement manufacturer and key construction material provider in Sarawak (or the State), Malaysia.

Whilst earnings and debt coverage metrics are anticipated to decline in the short-term, they are expected to pick up as CMS strengthens its market positioning and profit from serving the State’s future infrastructure projects. RAM predicts CMS’ operating cashflow debt coverage to improve to about 0.17 times in the next two years and stay above 0.30 times on a net debt basis. The company&rs...