Fitch rates Japfa Comfeed bonds A+(idn)

Fitch Ratings said it assigned a national long-term rating of A+(idn) to PT Japfa Comfeed Indonesia Tbk.’s Rp 3 trillion senior unsecured bond program.

The agency also said it assigned a rating of A+(idn) to the up to Rp 1 trillion of bonds that will be issued under this program.

The ratings reflect the company’s improved profitability and leverage since the second half of 2015, driven by better demand-supply balance for the poultry industry in Indonesia, Fitch said.

Japfa's EBITDA margin increased to 9.1% in 2015 and further to 12.7% in the first half of 2016 from 7.2% in 2014, the agency added.

Profitability for the company's main animal feed business segment has been resilient, while margins for its breeding and commercial farming operations improved significantly in 2015 following the government's measures to regulate chicken supply, Fitch said.

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