BANGKOK--OCT 9--TRIS
THAI RATING AND INFORMATION SERVICES (TRIS) AFFIRMED AN "A" RATING
FOR ITALIAN-THAI DEVELOPMENT PLC'S (ITD) 3,500 MILLION BAHT SENIOR
DEBENTURES ON 9 OCTOBER 1996. THE RATING REFLECTS THE COMPANY'S STRONG
MARKET POSITION, PROVEN ABILITY TO COMPLETE WORK ON TIME AND SOUND
FINANACIAL PROFILE. SEVERE MARKET RIVALRY CHARACTERIZED BY PRICE-CUTTING
AND DIMINISHING PROFIT MARGINS AFFECTS ITS PERFORMANCE. THE COMPANY'S
OVERALL BUSINESS STANDING ALSO DEPENDS ON FUTURE RETURNS FROM ONGOING
HIGHLY-CAPITALIZED INVESTMENTS.
ITD IS THE LARGEST LOCAL CONTRACTOR OPERATING IN VARIOUS
CONSTRUCTION SECTORS, LOCALLY AND INTERNATIONALLY. IT IS WELL-
DIVERSIFIED TO ENSURE ITS SELF-SUFFICIENCY, STABILIZE ITS INCOME STREAM
AND ENHANCE ITS OPPORTUNITY TO WIN CONTRACTS FROM ITS STRATEGIC PARTNERS.
ITD HAS ESTABLISHED A STRONG BUSINESS RELATIONSHIP WITH GOVERNMENT
AGENCIES AND ADOPTED STRATEGIC ALLIANCES WITH POTENTIAL CUSTOMERS,
FINANCIERS AND MAJOR CONTRACTORS IN THE MARKETPLACE. BASED ON ACCURATE
COSTING AND EFFICIENT PROJECT MANAGEMENT PRACTICES ITD HAS DEVELOPED A
CONSTRUCTION COMPETENCE AND ALSO HAS ACCESS TO COST EFFECTIVE AND RELIABLE
SUBCONTRACTORS. THE COMPANY ENJOYS CUSTOMER CONFIDENCE AND HAS A
REPUTATION FOR GOOD QUALITY CONSTRUCTION. IT HAS EXPERIENCED STEADY
GROWTH AND HAS MAINTAINED A RELATIVELY HIGH LEVEL OF WORK ON-HAND DESPITE
INTENSE MARKET COMPETITION. IN SEPTEMBER 1996, ITS BACKLOG OF 92
CONTRACTS AMOUNTED TO 40,588 MILLION BAHT, ABOUT 32% FROM THE BANGKOK MASS
TRANSIT SYSTEM PROJECT. THE REMAINING PROJECTS WERE MAINLY IN
TRANSPORTION, BUILDINGS, INDUSTRIAL PLANTS, TELECOMMUNICATION AND PIPELINE
WORK AND UTILITES.
ITD HAS RAISED ENORMOUS FUNDS TO EXPAND ITS CONSTRUCTION
BUSINESSES AND TO PARTICIPATE IN VARIOUS INVESTMENTS. DEBTS HAVE
PROGRESSIVELY INCREASED TO 7,737 MILLION BAHT WITH THE TOTAL DEBTS TO
CAPITALIZATION RATIO OF 45.8% IN JUNE 1996. OVERALL PROFITABILITY, ONCE
SOLID WITH MORE-THAN-20% PRETAX RETURN ON PERMANENT CAPITAL, DROPPED TO
16.7% IN 1995. ITS ABILITY TO PAY INTEREST AND REPAY PRINCIPAL HAS
DECLINED, PRETAX INTEREST COVERAGE WAS AT 4.1 TIMES, AND FUNDS FROM
OPERATIONS COVERED 25.7% OF TOTAL DEBTS LAST YEAR. ITD HAS PLANNED TO
EXTEND ITS BUSINESS OPERATIONS ACROSS MARKET SEGMENTS AND GEOGRAPHICAL
REGIONS. IN THE NEXT TWO YEARS MORE THAN 5,000 MILLION BAHT WILL BE
INVESTED IN NEW VENTURES.
NOTE: ITALIAN-THAI DEVELOPMENT PLC: RATING ASSIGNED
SENIOR DEBT: 3,500 MILLION BAHT DEBENTURES A
THAI RATING AND INFORMATION SERVICES (TRIS) AFFIRMED AN "A" RATING
FOR ITALIAN-THAI DEVELOPMENT PLC'S (ITD) 3,500 MILLION BAHT SENIOR
DEBENTURES ON 9 OCTOBER 1996. THE RATING REFLECTS THE COMPANY'S STRONG
MARKET POSITION, PROVEN ABILITY TO COMPLETE WORK ON TIME AND SOUND
FINANACIAL PROFILE. SEVERE MARKET RIVALRY CHARACTERIZED BY PRICE-CUTTING
AND DIMINISHING PROFIT MARGINS AFFECTS ITS PERFORMANCE. THE COMPANY'S
OVERALL BUSINESS STANDING ALSO DEPENDS ON FUTURE RETURNS FROM ONGOING
HIGHLY-CAPITALIZED INVESTMENTS.
ITD IS THE LARGEST LOCAL CONTRACTOR OPERATING IN VARIOUS
CONSTRUCTION SECTORS, LOCALLY AND INTERNATIONALLY. IT IS WELL-
DIVERSIFIED TO ENSURE ITS SELF-SUFFICIENCY, STABILIZE ITS INCOME STREAM
AND ENHANCE ITS OPPORTUNITY TO WIN CONTRACTS FROM ITS STRATEGIC PARTNERS.
ITD HAS ESTABLISHED A STRONG BUSINESS RELATIONSHIP WITH GOVERNMENT
AGENCIES AND ADOPTED STRATEGIC ALLIANCES WITH POTENTIAL CUSTOMERS,
FINANCIERS AND MAJOR CONTRACTORS IN THE MARKETPLACE. BASED ON ACCURATE
COSTING AND EFFICIENT PROJECT MANAGEMENT PRACTICES ITD HAS DEVELOPED A
CONSTRUCTION COMPETENCE AND ALSO HAS ACCESS TO COST EFFECTIVE AND RELIABLE
SUBCONTRACTORS. THE COMPANY ENJOYS CUSTOMER CONFIDENCE AND HAS A
REPUTATION FOR GOOD QUALITY CONSTRUCTION. IT HAS EXPERIENCED STEADY
GROWTH AND HAS MAINTAINED A RELATIVELY HIGH LEVEL OF WORK ON-HAND DESPITE
INTENSE MARKET COMPETITION. IN SEPTEMBER 1996, ITS BACKLOG OF 92
CONTRACTS AMOUNTED TO 40,588 MILLION BAHT, ABOUT 32% FROM THE BANGKOK MASS
TRANSIT SYSTEM PROJECT. THE REMAINING PROJECTS WERE MAINLY IN
TRANSPORTION, BUILDINGS, INDUSTRIAL PLANTS, TELECOMMUNICATION AND PIPELINE
WORK AND UTILITES.
ITD HAS RAISED ENORMOUS FUNDS TO EXPAND ITS CONSTRUCTION
BUSINESSES AND TO PARTICIPATE IN VARIOUS INVESTMENTS. DEBTS HAVE
PROGRESSIVELY INCREASED TO 7,737 MILLION BAHT WITH THE TOTAL DEBTS TO
CAPITALIZATION RATIO OF 45.8% IN JUNE 1996. OVERALL PROFITABILITY, ONCE
SOLID WITH MORE-THAN-20% PRETAX RETURN ON PERMANENT CAPITAL, DROPPED TO
16.7% IN 1995. ITS ABILITY TO PAY INTEREST AND REPAY PRINCIPAL HAS
DECLINED, PRETAX INTEREST COVERAGE WAS AT 4.1 TIMES, AND FUNDS FROM
OPERATIONS COVERED 25.7% OF TOTAL DEBTS LAST YEAR. ITD HAS PLANNED TO
EXTEND ITS BUSINESS OPERATIONS ACROSS MARKET SEGMENTS AND GEOGRAPHICAL
REGIONS. IN THE NEXT TWO YEARS MORE THAN 5,000 MILLION BAHT WILL BE
INVESTED IN NEW VENTURES.
NOTE: ITALIAN-THAI DEVELOPMENT PLC: RATING ASSIGNED
SENIOR DEBT: 3,500 MILLION BAHT DEBENTURES A