KUALA LUMPUR: Malaysian Rating Corp Bhd (MARC) has affirmed its AA+IS rating on Westports Malaysia Sdn Bhd’s RM2 billion Sukuk Musyarakah Programme with a stable outlook.
The agency said the rating is driven by Westports’ solid financial metrics as reflected by its stable operating margins and strong finance service coverage on the back of commendable operational performance.
It said the rating also benefits from Westport’s strong competitive position in transhipment in the region with a capacity to handle 12.5 million twenty-foot equivalent units (TEU) per annum.
"Moderating the rating is the group’s exposure to a concentrated clientele base and to the vagaries of the shipping industry", it said in a statement.
MARC said Westports has continued to invest in capacity expansion at its port in Port Klang, currently focusing on completing the construction of the second phase of Container Terminal 8 (CT8), the first phase of which added one million twenty-foot equivalent unit (TEUs) and was commissioned in May 2016.
The second phase, which is expected to be fully completed by November 2017, involves constructing a 300m wharf that will add a further 0.5 million TEUs.
The group has also commenced construction of phase one of CT9 which will add a 600m wharf – the construction has achieved 25 per cent completion as at end-March 2017.
MARC said Westports’ ongoing capacity expansion and upgrades are key strategies in enabling the port operator to maintain its competitive position in the container handling segment.
The segment registered a throughput volume growth of 9.9 per cent year-on-year to 9.95 million TEUs, accounting for 40 per cent of Malaysia’s container market share in 2016.
MARC said the outlook on Westports remains stable on expectations that the port operator will continue to maintain its operational and financial metrics at current levels.
ENDS
Keywords: Westports Malaysia Sdn Bhd, Malaysian Rating Corp Bhd, MARC, ratings, stable outlook, financial performance