Sempati rating lowered

Sempati rating lowered

JAKARTA (JP): Pefindo, Indonesia's only credit rating agency,
has decided to downgrade the rating of PT Sempati Air's Rp 50
billion (US$21.09 million) commercial paper to B with from A-4
previously.

The rating company said that the downgraded rating reflected
the airline company's unfavorable financial performance.

The company's financial performance had not shown significant
improvement following the restructuring of the company's
management recently.

"The declining liquidity and leverage conditions are still
Pefindo's major concern," it said.

According to the rating company, current ratio had declined as
of July, 1996 due to the increase in short-term debt, consisting
mostly of bank loans and commercial papers.

Pefindo, however, viewed that the new management was exerting
positive efforts to improve the company's financial performance.

It hoped that the new management would continually commit itself
to improve the management of its receivables through the
implementation of revenue accounting. (hen)