31.08.2016, 19:40
Moody's Changes Agile Group's Outlook to Stable from Negative
OREANDA-NEWS. On August 31, 2016, the press release was corrected as follows: In the first sentence of the last paragraph of the Ratings Rationale section, “Agile Property Holdings Limited” was changed to “Agile Group Holdings Limited.”
Hong Kong, August 30, 2016 -- Moody's Investors Service has changed to stable from negative the outlook of Agile Group Holdings Limited's Ba3 corporate family rating.
At the same time, Moody's has affirmed Agile's Ba3 corporate family rating and the B1 senior unsecured ratings to the bonds issued by Agile.
"The change to a stable outlook reflects the consideration that Agile's refinancing risk has fallen due to its improved level of pre-sales and demonstrated access to both onshore and offshore debt markets," says Kaven Tsang, a Moody's Vice President and Senior Credit Officer.
"The stable outlook also reflects the improvement in debt leverage," says Tsang, who is also the Lead Analyst for Agile.
Agile's liquidity position improved in 1H 2016, as evidenced by an increase in cash holdings to RMB20.2 billion as of June 2016 from RMB13.1 billion as of December 2015.
Thus, cash/short-term debt rose to 145% as of June 2016 from 80% as of end-2015.
Such an improvement was because the company's pre-sales grew 37% year-on-year to RMB28 billion in 1H 2016. Moody's expects it to maintain growth of 10%-15% in the next 12 -18 months.
In addition, Agile's positive performance has strengthened its access to the debt markets, as evidenced by its raising of more than RMB15 billion in new funds in the first seven months of 2016.
The company was also able to access funding from various sources which included domestic bonds of RMB2.8 billion, offshore loans totaling HKD7.5 billion and panda bonds of RMB3 billion.
Part of such funding has been used to early redeem the USD650 million in bonds due in April 2017.
Agile has managed down its debt leverage. Revenue/adjusted debt increased to 100% for the 12 months to June 2016 from 91% in 2015.
Moody's expects that the company will raise debt to complete the construction of the high volume of pre-sales secured in the last 12 months. It will likely recognize the associated revenue over the next 2 years. In addition, it will purchase land for replacement.
Thus Moody's expects revenue/adjusted debt to stay at 80%-82% and EBIT/interest coverage to stay at 2.6x-2.9x, thereby supporting its Ba3 corporate family rating.
Hong Kong, August 30, 2016 -- Moody's Investors Service has changed to stable from negative the outlook of Agile Group Holdings Limited's Ba3 corporate family rating.
At the same time, Moody's has affirmed Agile's Ba3 corporate family rating and the B1 senior unsecured ratings to the bonds issued by Agile.
"The change to a stable outlook reflects the consideration that Agile's refinancing risk has fallen due to its improved level of pre-sales and demonstrated access to both onshore and offshore debt markets," says Kaven Tsang, a Moody's Vice President and Senior Credit Officer.
"The stable outlook also reflects the improvement in debt leverage," says Tsang, who is also the Lead Analyst for Agile.
Agile's liquidity position improved in 1H 2016, as evidenced by an increase in cash holdings to RMB20.2 billion as of June 2016 from RMB13.1 billion as of December 2015.
Thus, cash/short-term debt rose to 145% as of June 2016 from 80% as of end-2015.
Such an improvement was because the company's pre-sales grew 37% year-on-year to RMB28 billion in 1H 2016. Moody's expects it to maintain growth of 10%-15% in the next 12 -18 months.
In addition, Agile's positive performance has strengthened its access to the debt markets, as evidenced by its raising of more than RMB15 billion in new funds in the first seven months of 2016.
The company was also able to access funding from various sources which included domestic bonds of RMB2.8 billion, offshore loans totaling HKD7.5 billion and panda bonds of RMB3 billion.
Part of such funding has been used to early redeem the USD650 million in bonds due in April 2017.
Agile has managed down its debt leverage. Revenue/adjusted debt increased to 100% for the 12 months to June 2016 from 91% in 2015.
Moody's expects that the company will raise debt to complete the construction of the high volume of pre-sales secured in the last 12 months. It will likely recognize the associated revenue over the next 2 years. In addition, it will purchase land for replacement.
Thus Moody's expects revenue/adjusted debt to stay at 80%-82% and EBIT/interest coverage to stay at 2.6x-2.9x, thereby supporting its Ba3 corporate family rating.
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