PEFINDO has affirmed its idBBB+ ratings to PT J Resources Asia Pasifik Tbk

(July 4, 2023)--PEFINDO has affirmed its idBBB+ ratings to PT J Resources Asia Pasifik Tbk (PSAB), the Company’s Shelf-Registered Bond I and its MTN I. We revised the outlook for the corporate rating to “stable” from “CreditWatch with Negative Implication” following the repayment of Shelf-Registered Bond I Phase I Year 2019 and the Company’s improved liquidity profile after successfully restructured its outstanding bonds.

The corporate rating reflects PSAB’s sizeable mining reserves and resources, moderate financial flexibility, and the high demand for gold. The rating is constrained by its aggressive capital structure, exposure to the fluctuation of gold prices, and risks related to the development of new mines.

The rating may be raised if PSAB fully operates its new projects which improves its financial profile on a sustained basis. The rating may be under pressure if there is a delay in Doup development. It may result in significantly lower production volume than projected in the near term and negatively impact PSAB’s revenue which will further aggravate its financial profile. A significant drop in the price of gold may also trigger a rating downgrade, as this may adversely affect its financial figures.

PSAB was established in 2002 and its operations cover the exploration, mining, and processing of gold. It has a geographically diverse portfolio of assets across Indonesia (Seruyung in North Kalimantan; and Bakan, Lanut, and Doup in North Sulawesi) and Malaysia (Penjom). The Company owned two producing mines and one mine in construction stage. As of March 31, 2023, its shareholders consisted of Jimmy Budiarto (92.50%), Sanjaya J (0.02%), and the public (7.48%). (ends)