D&L Industries, Inc.’s P5-billion fixed rate bonds maintained the highest credit rating it received from the Philippine Rating Services Corp. (PhilRatings) as it keeps a solid market position through its four principal businesses.
The company’s bond issuance received a rating of PRS Aaa with a stable outlook, which is considered to be of the highest quality with minimal credit risk.
Meanwhile, a stable outlook means that the assigned rating “is likely to be maintained or to remain unchanged in the next 12 months.”
The maiden bond issuance has a principal amount of P3 billion, with an oversubscription option of up to P2 billion, and a tenure of three to five years.
According to the company’s disclosure to the Philippine Stock Exchange, PhilRating’s rating and outlook were assigned in consideration of the company’s market position, diversification of products, innovation-driven specialty products, sustained profitability, and debt management.
The ratings were based on available information at the time that the rating review was performed and are continually monitored as PhilRatings may change the rating and outlook at any time.
PhilRatings said that D&L Industries continues to enjoy a solid market position in its four principal businesses; food Ingredients; oleochemicals and other specialty chemicals; specialty plastics; and consumer products original design manufacturer.
It added that D&L Industries was able to maintain its conservative debt position having a total debt of P13.7 billion as of end-June 2022, 1% lower than last year due to net repayments of borrowings.
PhilRatings noted that the company’s debt-to-equity ratio was maintained at 0.7x by the end of the first half with the total debt capitalization ratio also unchanged at 42%.
Proceeds from the bond issuance were intended to be mainly used for the completion of the D&L Industries’ biggest project.
Slated to be completed by January 2023, the expansion project will sit on a 26-hectare property at First Industrial Township in Tanauan, Batangas. It will house plant-specific buildings, machinery, and equipment.
The company expects its capital expenditure to slow down after the completion of its Batangas facility.
D&L Industries’ principal business activities include manufacturing customized food ingredients, specialty raw materials for plastics, and oleochemicals for personal and home care use.
On the stock market on Monday, shares in D&L Industries added nine centavos or 1.29% to P7.04 apiece. — Justine Irish D. Tabile
