PSS UTILIZING ITS FINANCIAL CAPACITY TO SUPPORT FLEET EXPANSION PROGRAM

  • Obtain shareholders’ approval for all of the meeting agenda
  • Long-term loan facility of up to USD21 million to finance new fleet
  • Added 2 (two) units of Supramax class vessels to expand Mother Vessel (MV) business

 

JAKARTA, FEBRUARY 27, 2019

PT Pelita Samudera Shipping Tbk (“The Company”, “PSS”, IDX code: PSSI) has conducted Extraordinary General Meeting of Shareholders (EGMS) in which all agenda approved by shareholders.

First, the shareholders approved the Company’s plan to obtain long-term financing facilities from ICICI Bank Limited, Singapore Branch for a term-loan facility amounted up to USD21 million with tenor of maximum 5 years and 3 quarters as well as derivative facility amounted about USD1.5 million for hedging purpose.

PSS plans to use the term-loan facility to finance its fleet expansion, including the purchase of its second Supramax class mother vessel.

Second, the shareholders approved the change of the Company’s official domicile from previously West Jakarta to Central Jakarta in line with the increase in business activities and the growth of PSS. At the beginning of March 2019, the Company is officially moving to its new office at Menara Astra on Jl. Jend. Sudirman Kav. 5-6 from previously at Menara Citicon.

Third or final agenda, the shareholders also approved the Company’s plan to obtain Foreign Exchange facility amounted maximum USD5 million from Citibank N.A., Indonesia, which may be deployed for hedging purpose as PSS has part of its revenues, cost, and funding for capital expenditure in USD currency.

Utilizing financial capability

In 2018, PSS entirely financed its capital expenditure by internal funding as part of the Company’s long-term growth strategy to build solid financial capability for supporting its future expansion.

With currently healthy Balance Sheet and Cash Flow (Gearing Ratio of 0.38x, Current Ratio of 2.2x, Net Debt to EBITDA Ratio of 0.66x as of September 30, 2018), this year PSS will start to utilize its financial capacity for partially funding its fleet expansion in 2019.

Shareholders’ approval for obtaining long- term loan facility of up to USD21 million today is very important for PSS as the Company is looking at opportunities for expanding its MV business as well as refleeting its Tugboat and Barges (TNB) fleet.

Expansion in MV fleet

In February 2018, PSS started its MV business with 1 unit of Handysize class (above 30k dwt) vessel “MV Dewi Saraswati”, then followed by another 1 unit of Handysize class vessel “MV Dewi Ambarwati” on December 2018.

PSS opened the year 2019 with the purchase of its first Supramax class MV (above 50k dwt) with total transaction value of USD10.5 million, signing of Sales and Purchase Agreement (SPA) on January 22, 2019.

This MV’s acquisition transaction was completed at the second week of February, 2019. The new MV named “Daidan Pertiwi” will be chartered to transport coal or nickel ore for feedstock of a nickel smelter in Southeast Sulawesi.

Further, the Company added another Supramax class Mother Vessel for USD9.67 million, which will be partially funded with the planned loan from ICICI Bank Limited, Singapore Branch.

As such, PSS fleet will have total MV capacity of about 174.6k dwt by 1Q 2019 from only about 31k dwt by 1Q 2018 or a jump of more than 5x folded.

MV’s fleet expansion will be one of the key drivers for the Company’s revenue growth in 2019, as last year the Company’s MV contributed only about 5% of its Revenue.