Moody’s: Pan Brothers notes B1

Moody's Investors Service said it assigned a B1 corporate family rating to Pan Brothers Tbk.

The agency also said it assigned a B1 rating to the proposed issuance of dollar-denominated senior unsecured notes by wholly owned subsidiary, PB International BV.

The notes will be irrevocably and unconditionally guaranteed by Pan Brothers and all of its subsidiaries, Moody’s said.

The proceeds will be used to refinance existing indebtedness and the balance available for general corporate purposes, the agency said.

The outlook is stable.

The ratings reflect Pan’s demonstrated ability to generate solid earnings growth and maintain stable margins within a competitive and fragmented Indonesian garment manufacturing sector, supported by its longstanding relationships with major global apparel retailers and investments in capacity expansion, Moody’s said.

The ratings are constrained by Pan’s moderate leverage, relatively small scale when compared to industry peers, seasonality of operations and customer concentration, the agency said.

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