Computer manufacturer Mustek has received an upgrade to its credit rating from CA-Ratings.
The group, which owns the Mecer PC brand, says it has been awarded a zaBBB rating, up from its previous zaBBB- rating.
CA-Ratings defines the symbol as indicating an adequate capacity "to pay interest and repay capital, relative to other South African obligors".
"It normally has adequate protection parameters, but adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay capital than debt in categories rated higher."
Mustek received a zaBBB- rating in 2003, placing it just above the cusp on the South African national scale. Prior to this, it had a zaBB+ rating, awarded in October 2001.
The latest rating puts it above the median in counterparty strength and puts it in a solid investment grade.
Mustek`s latest balance sheet, as at 31 December 2005, showed total long-term liabilities of R68.4 million, down from R245.8 million on 30 June 2005. Fixed assets amounted to R153.22 million, with total long-term assets of R237.1 million.
Current assets of R1.28 billion on 30 December compared with current liabilities of R864.3 million.
Mustek says the ratings committee took into account, among other things, that the Mecer brand has given the group the required market positioning and a sustained large market share in SA.
It also recognised increased funding options as a result of the securitisation of the Mustek, Rectron and Comztek trade receivables books.
Securitisation is the creation of a financial instrument by aggregating similar instruments (such as credit portfolios) and marketing them to investors.
The Mustek share was at 1 079c in early trade on the JSE this morning. This was up 9c or 0.8% on Friday`s close. The share lost 10c on Friday.
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