Published Date: 2006-07-26 

Hi klse.8k,

FYI  

Source: http://www.theedgedaily.com/cms/ ... a-1b483920-92319608

25-7-2006 2:03pm
Rating Agency Malaysia Bhd has revised the rating outlook on Memory Tech Sdn Bhd’s (MTSB) RM320 million bai’ bithaman ajil Islamic debt securities (BaIDS) (2005/2012), from stable to egative.

RAM said on July 25 that the BaIDS is currently rated A2 by RAM and carries a corporate guarantee from MTSB’s holding company, Megan Media Holding Bhd.

As MTSB is the main contributor of the Group’s earnings, the rating essentially mirrors Megan Media’s business and financial profiles.

"The negative outlook reflects RAM’s concerns about Megan Media’s rising debts to support its capital spending and the prevailing industry depression.

"The increase in borrowings has resulted in a lower-than-expected debt coverage ratio, and could lead to non-compliance of 2 financial covenants in the Trust Deed for the BaIDS (depending on the interpretation of specific key clauses in the Trust Deed)," it said.

RAM said the management was negotiating with the BaIDS holders to address this issue prior to the release of its financial statements for FY ended April 30, 2006 (FY April 2006), so as to avoid an event of non-compliance altogether.

Additionally, the squeeze in the Group’s margins reflected the dynamism and volatility of the blank-data-storage media industry, which offers less comfort vis-a-vis the stability of Megan Media’s earning capacity.

Megan Media could also embark on more aggressive capital spending to fuel its expansion into HD-DVD and Blu-Ray technologies, which may yield higher margins.

Financially, Megan Media performed well in FY Apr 2006 and was able to meet RAM’s earlier expectations. It posted a RM249.64 million operating profit before depreciation, interest and tax (OPBDIT) on the back of RM1.03 billion of revenue.

"That said, RAM notes that the global blank-data-storage media industry remains volatile and fast-paced, thus exposing Megan Media to industry fluctuations. This was evident from the numerous challenges faced by the Group in FY Apr 2006 (e.g. increases in polycarbonate prices and lower average selling prices for DVD-Rs due to global oversupply)," it said.

Meanwhile, Megan Media’s borrowings increased to RM838.91 million as at end-FY Apr 2006 from RM647.16 million a year earlier, well above the peak of RM700 million that had been anticipated for the tenure of the BaIDS (This is not an imposed limit nor a covenant of any lender to Megan Media).

RAM said the additional debt, mainly utilised for the purchase of new plants and machinery as well as for working capital, had augmented the Group’s ratio on total debt to equity to 1.78 times, while pushing up its ratio on total debt to earnings before interest, tax, depreciation and amortisation (EBITDA) to 3.35 times.

Megan Media is currently considering options to reduce its debt burden; RAM will closely monitor further developments on this matter.

RAM notes that the rating outlook could be revised to stable if the Group successfully reduces its gearing level and the industry shows sign of recovery. On the other hand, the rating could be lowered if Megan Media’ s net debt continues to rise and its debt-protection measures weaken as a result of increased capital spending.



Another news from Megan…

Mohammed Rashdan Bin Mohd Yusof has resigned as director on 20 July 2006.And we knew the Chairman (DATO DR HJ MOHD ADAM BIN CHE HARUN) has sold all his shares (do not know who is the buyer). All the news are strange to me. On one hand, I am confident to Megan (I will buy another 3000 Megan shares this week,then I would have 13000 Megan shares at average price RM0.70, on the other hand, it seem many bad news about Megan). This is my first share investment and have meet this exciting counter (Megan). I hope all the bad news are camouflage only and Megan will have a very bright future  
Lastly, my decision to invest in Megan is my own decision and I take responsibility on this.
Bye..


回复：

谢谢你的消息，今天早上我打个电话给Megan的Macy Thong，她说Mohammad Rashdan辞职是因为conflict of interest，理由：Mohammad Rashdan的私人公司提供商业咨询给Megan所以他本身就不适合成为董事了。

我问：那么谁将顶替呢？
她说：暂时不需要顶替，因为公司的独立董事已经足够了。

我问：为什么RAM会把评级降低呢？
她答：主要原因是公司增加贷款买新机器，而且RAM是以国际的大环境来给评级的。

我问：为什么公司不把成长步伐放慢，这样就不必增加贷款，而评级就可以维持了。
她答：但是，我们得把握机会来发展呀。

我问：公司的决策人是不是YEO，那个年轻人？
她答：不错，就是他。

我问：关于上次的提问，你还没有告诉我什么是other receivables？
她答：那只是很小的数目而已，主要的是deposits & prepayment，订购新机器的数额。

希望以上资料能够帮助到你，谢谢。
再见。

你可以尝试打电话给megan，我鼓励你，这是一个不错的经验，你只要是小股东就可以了，就算只有1股也可以讯问， 电话是：03-56373995。
就试试看吧，你将来会感激我的，因为你马上就变成一个认真的投资者！

也许你不知道要问什么，就问看你听到的传言也可以，例如董事主席是否已经卖掉他的全部股票了？是谁买去呢？或者问一问公司的业务也可以，有没有加班啦？机器是否一星期7天，每天24小时操作啦？或者问：公司为什么不乘机低价买回自己的股票？等等。

她会很客气的回答你的所有问题，当然，我们也得很客气的提出问题。
这就是商业礼貌。

我等你的消息，再见。
（哈，你会发觉，原来要打一个电话也需要勇气！这就是成长的过程）

你很快就是成功的投资者，我对你有信心。

再见，

Klse.8k  上
26/7/2006