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Sydney, Mar 2, 2006 AEST (ABN Newswire) - Mayban Securities has downgraded Malaysian road toll operator, Plus Expressway, to Sell from Hold due to higher fuel prices impacting on traffic volume as well as its debt restructuring delay.
The price of petrol has increased three times since last May - from MYR1.42 to MYR1.92 yesterday.
As such, traffic numbers have grown by a paltry 0.8 per cent year-on-year in fiscal 2005 for the toll operator.
Besides, Plus has still not managed to extend its debt tenure given the unavailability of long term bonds.
Mayban indicated the debt restructuring process could be delayed beyond 2006 instead of having it completed in the 2005 financial year.
As a result of the negative elements, the broker has decreased its net profit in fiscal 2006 by 7.4 per cent to MYR845.6 million. For fiscal 2007 net profit has been revised downwards by 8.5 per cent to MYR878.4 million.
