FITCH Ratings has downgraded Malaysia-based energy-service provider Serba Dinamik Holdings Bhd’s long-term issuer default rating to “CCC-” from “B-”.
Similarly, the international rating agency has also downgraded the company’s senior unsecured sukuk due on May 2022 and March 2025 to “CCC-” from “B-” with a recovery rating of “RR4”.
All the ratings were removed from Rating Watch Negative (RWN) which was placed on June 3, 2021.
“The downgrade reflects Serba Dinamik’s diminished cash reserves, stretched liquidity and heightened re-financing risk on short-term debt with RM100 mil in commercial paper and US$222 mil in sukuk – both due in May 2022,” Fitch Ratings pointed out in a rating action commentary.
“The review is ongoing and it is unclear when it (the review) will be finalised – and pending its satisfactory completion – Serba Dinamik has limited time to address its impending maturities.”
Reacting to the latest rating downgrade by Fitch Ratings, Serba Dinamik’s group managing director/CEO Datuk Dr Mohd Abdul Karim Abdullah said such outcome is very much anticipated given that Serba Dinamik has yet to come out with its statutory audit report.
“However, we are working to complete it by the dateline given by Bursa Malaysia,” he told FocusM. “Our statutory audit for FY2020 is progressing well with our newly appointed external auditor Nexia SSY PLT working day and night to complete the audit report.”
In a letter dated Oct 25, the market regulator has approved Serba Dinamik’s request for extension of time of one month from Oct 31 until Nov 30 to issue the company’s annual report that includes the annual audited financial statements together with its auditors’ and directors’ reports for the financial period ended June 30, 2021.
Serba Dinamik was last transacted at 35 sen at the close of Oct 22’s mid-day trading prior to the trading suspension of its shares/warrants which gave the company a market capitalisation of RM1.31 bil. – Nov 3, 2021
