Anam Waqas Ghayour
PACRA Updates Entity Ratings of Pakistan International Bulk Terminal Limited | RW | Developing Outlook
The Pakistan International Bulk Terminal Limited (“PIBT” or “the Company”) has secured a distinguished position in its operating segment due to its strategic importance in the Power and Cement sector. With a fully automated infrastructure, the Company's annual capacity hovers around 12 million MT for inbound coal handling and 4 million MT of outbound clinker and cement handling. The demand for imported coal in the industry is significantly reduced due to macroeconomic conditions including but not limited to import restrictions, severe devaluation of PKR against USD, and slowdown of economic activities resultantly demand from cement and power sector players switched to local or Afghani coal. Therefore the volumes handled by PIBT significantly dropped. During 9MFY23, PIBT handled 3.8mln tons of cargo against 6.2mln tons in the same period last year (FY22: 8.2mln tons, FY21: 10.1mln tons). Amid declining volumes, PIBT topline clocked at PKR 6.9bln (9MFY22: PKR 7.4bln). The bottom line of PIBT turned red and posted a net loss of PKR 2.5bln (9MFY22: loss of PKR 151mln, FY22: loss of PKR 991mln). The loss is majorly due to the impact of currency devaluation on USD denominated foreign loans. FCFOs of the Company are also affected impairing the ability to service its debt in timely manner. In view of the prevailing economic conditions, the Company requested its foreign lenders International Finance Corporation (IFC) and OPEC Fund for International Development (OFID) to defer the payment of its principal installments due in Jun-23 as notified on PSX, notice dated 15-Jun-23. The formalization of this arrangement is in process and expected to finalize soon. However, the Company ensures to make interest repayments in a timely manner. Obligations towards local financing arrangements will continue to remain as per agreed terms. While, the management provides comfort that the volumes will rebound, consequently improving the financial position of the Company.
Developing outlook and rating watch reflect the ongoing development towards the finalization of re-profiling arrangements with the foreign lenders as requested by the Company. Timely conclusion of the arrangements remains imperative for holding the ratings of the Company.
Pakistan International Bulk Terminal Limited (PIBT) was incorporated in November 2010, got listed on the Pakistan Stock Exchange in 2013 and commenced its commercial operations on July 3, 2017. The company operates on a "build, operate and transfer" (BOT) model at Port Qasim Authority for the provision of terminal handling services for Coal, Clinker, and Cement for a period of 30 years. Ownership of the company vests with Premier Mercantile Services (Pvt.) Limited (PMS) (~43%), which is the flagship Company of the “Marine Group of Companies” is acting as an Investment arm. Mr. Haleem Ahmed Siddiqui is the Chairman of the Board. He, along with his family, collectively own PMS. Mr. Haleem Siddqui has over ~50 years of experience in marine-related services. He joined Pakistan Merchant Navy in 1959 and commanded various vessels till 1971. He was also the founding Chairman of the Pakistan International Container Terminal (PICT). Mr. Sharique Azim Siddiqui is the CEO of PIBT. He is assisted by a team of qualified professionals.