JAKARTA. Fitch Ratings has demoted the rating of PT Pan Brothers Tbk (PBRX) to the lowest level following a default and ever-shrinking financial performance.

First, Fitch lowered long-term Issuer Default Rating (IDR) of PBRX to “C” from “CCC-.” Then, the rating for non-guaranteed senior bonds of PBRX worth USD 171 million, issued by PB International B.V., is also lowered to “C” from “CCC-” with a recovery rating of “RR4.”

Lastly, Fitch also demoted long-term national rank of PBRX to “C (idn)” from “CCC- (idn).”

In the official statement, Fitch mentioned that this rating downgrade takes place following PBRX’s default of amortisation worth USD 5 million charged upon syndicated loan of USD 124 million, which was due last September 27, 2023. It then puts PBRX in a grace period for 30 days with its bank creditors.

“A “C” national rating indicates default, or a process similar to default has taken place, or issuer entering a standstill, or, in a case of closed funding vehicle, its payment capacity has been challenged,” Fitch explained in the official statement.

According to IDNFinancials data, PBRX is one of the biggest garment manufacturers in Indonesia. Several of big names listed as its users include Adidas and Uniqlo. The production capacity of the company is recorded at 117 million per year. (KR/ZH)