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Fitch cuts Arpeni Pratama view to negative
Fitch Ratings said it revised PT Arpeni Pratama Ocean Line Tbk.'s outlook to negative from stable, while affirming the company's long-term foreign- and local-currency issuer default ratings at B+ and national long-term rating at A(idn). The rating on the $160 million senior unsecured notes due 2013 also has been affirmed at B based on a recovery rating of 5.
The outlook follows the company's high short-term debt at March 2009 as a result of sustained high trade receivables and weaker than expected earnings in the first quarter of 2009, Fitch said.
While Arpeni usually generates higher earnings in the second-half of the year due to seasonality factors, the agency said it needs to significantly reduce short-term debt, which incur high interest costs and reduce losses on chartered-in vessels to improve its interest coverage.
The ratings are supported by its established position in the intra-Indonesian seaborne coal transportation segment and the relationship-driven business model, which provides stable operating margins, Fitch said.
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