CLI bonds rated PRS Aa plus by PhilRatings
Real estate developer Cebu Landmasters, Inc. (CLI) said on Tuesday that its 8 billion peso fixed rate bond issue denominated in pesos was given an issue credit rating of PRS Aa plus with a stable outlook.
Philippine Rating Services Corp. (PhilRatings) also upgraded the issue credit rating of CLI’s outstanding series A to C corporate notes worth P5 billion to PRS Aa plus, with a stable outlook, from PRS Aa.
The proposed bond issue has a principal amount of up to 5 billion pesos with an oversubscription option of 3 billion pesos. It is the first tranche of the company’s 15 billion peso off-the-shelf registered debt program to be used within three years.
CLI said it plans to use the proceeds from the issuance to support its growth plans, primarily for market investments and land banking activities.
A PRS Aa credit rating signifies that the issue is of high quality and is subject to very low credit risk. He also indicates that CLI’s ability to meet its financial commitment is very strong. It may also include a plus or minus to further qualify its ratings.
A stable outlook means that CLI’s PRS Aa rating is likely to be maintained or remain unchanged over the next 12 months.
PhilRatings outlook and rating reflect an obligor’s sound management and strategy, improved profitability, adequate interest coverage even with a higher debt position and the threats of a highly competitive market, and a reserve Substantial land tenure – offset by the company’s ability to form strategic joint venture partnerships.
The company said the ratings were based on information and projections available at the time the ratings review was conducted and could change if circumstances warrant a change.
CLI is a Cebu-based company engaged in the development, sale, rental and management of real estate. Its portfolio includes residential condominium units, subdivision houses and lots, townhouses, hotels, office projects, commercial spaces and townships.
As of March 31, CLI had completed 36 projects, which were a mix of housing, office, hotel, retail and mixed-use. It also has 55 ongoing projects, with a combined total of 19,833 units, located in strategic locations in Visayas and Mindanao.
CLI has a pipeline of 21 projects for the next two years, including 19 housing units, an office condo and the start of lot sales in Davao Global Township.
In trading on Tuesday, CLI shares were flat at P2.50 apiece. — Justine Irish D. Tabile