S&P turns Japfa Comfeed view to negative

S&P said it revised its outlook for PT Japfa Comfeed Indonesia Tbk. to negative from stable and affirmed its BB- issuer and issue ratings.

“The credit quality of Japfa will likely weaken following the completion of distribution in specie of its entire shareholding in the AustAsia dairy business. Japfa will lose the diversification benefits derived from its China-based dairy business. This includes a higher operating margin and comparatively stable revenue stream supported by favorable demand/supply outlook in China. Japfa's overall scale will reduce materially, given that the dairy business contributed 30% of Japfa's consolidated EBITDA in 2021. AustAsia's operating profit margin was 20% in 2021 compared with Japfa group's overall margin of 7.2%,” the agency said in a press release.

The revised outlook means a downgrade if the listing of AustAsia and distribution in specie becomes highly likely to be completed, S&P said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.