The share price of Minor International Public Company Limited (MINT) rose ฿1.00/share or 3.42% to ฿30.25/share with a trading value of 991 million baht.
MINT revealed that the company has successfully secured the bondholders’ approval for the extension of its financial covenant testing waiver for another two years until the end of 2022. In addition, MINT has obtained the approval to exclude the COVID-19 impairment impact to its equity in the debt covenant calculation until the end of 2024. These measures are a component of MINT’s proactive balance sheet management plans that are being executed to minimize any potential risks amidst the current uncertain operating environment, especially during this short-term period before the distribution of the COVID-19 vaccines.
Brian James Delaney, MINT’s Chief Financial Officer, noted that “This approval from bondholders is a testament of their confidence in the Company and will provide the Company with a stable financial platform to execute our on-going balance sheet management plans and to ensure business continuity and sustainability.” He further added, “I would like to express my sincere appreciation to all our bondholders for their support during these extremely challenging times. MINT is committed to honor all of our interest and principal commitments.”
MINT reiterated its commitment to continue to focus on preserving liquidity and managing its balance sheet through significant cost cutting programs, capital expenditure reduction and asset rotation strategy. As at end of January, MINT had approximately Baht 25 billion of available cash and Baht 29 billion of unutilized credit facilities which is sufficient to support the operations going forward.
KTBST Securities (KTBST) recommended “BUY” on MINT and raise a target price to ฿36.00/share following the successfully secured the extension of financial covenant testing waiver for another two years, being positive toward this issue. The exemption of the COVID-19 impairment impact until the end of 2024 will lessen the ceiling Net D/E at 1.75x amid an uncertain situation.
In 3Q20, MINT had a total debenture of 60 billion baht and Net D/E was at 1.67x. The exclusion of debt covenants will not cause the debenture a default in case D/E exceeds the limit. Hence KTBST believes the issue will give a positive sentiment to MINT’s price and will boost investors’ confidence toward MINT’s financial position.