Astra claims debt-free status

The Jakarta Post, Jakarta

Domestic auto giant PT Astra International announced on Tuesday it had achieved debt-free status following the payment of an outstanding US$30 million from a revolving loan facility.

"We are very pleased at the moment to be fully debt free," Astra finance director John Slack said in the statement. "But we will continue to look at business opportunities in the future that may require new equity and debt."

Slack said that Astra had the support of a group of 19 international banks under which the company can draw up to US$170 million and Rp 600 billion (some $63.1 million) for future investment and working capital needs.

Following the late 1990s Asian financial crisis, Astra in June 1998 started negotiations with its lenders to restructure a total of US$995 million and Rp 1.12 trillion of its liabilities, and completed it the following year.

Astra further restructured its debts in 2002, and in 2003 raised $150 million through a lender-approved rights issue, of which some of the proceeds were used to repay its then outstanding $720 million and Rp 830 billion debt.

During 2003 and 2004, thanks to strong earnings and increased dividend flows from subsidiaries and associates, the company was able to aggressively speed up the payment of its debt.

"By April 27, thanks to strong cash flows, payment of this outstanding debt was completed," Slack said.

Astra booked a net income of Rp 5.4 trillion last year and raised its consolidated net profit by 22.3 percent from Rp 4.4 trillion in 2003.