Power Cement Limited (PSX: POWER) has decided to re-profile long-term obligations of Rs. 11.9 billion, the company informed the Pakistan Stock Exchange on Monday.
“In the wake of rising inflationary pressures, high-interest rates and depressed local demand, Power Cement Limited (the Company) has finalized an arrangement with a local syndicate of banks to re-profile its outstanding long-term obligations of Rs. 11.9 billion,” the filing stated.
The local syndicate of banks in respect of their long-term debt has favorably agreed on the following salient terms:
- Four biannual principal repayments due from July 2023 to January 2025 have been agreed to be reduced from Rs. 1.19 billion to Rs. 119 million each.
- Two biannual principal repayments falling due in July 2025 and January 2026 have been agreed to be reduced from Rs. 1.19 billion to Rs. 298 million each.
- The remaining principal amount of Rs. 10.8 billion has been agreed to be paid in eight equal biannual installments of Rs. 1.35 billion each (from July 2026 to January 2030).
- Previously, the Diminishing Musharakah was scheduled to be fully repaid in January 2028 but now, as a result of the above revision, the same is scheduled to be fully repaid in January 2030.
- Additionally, the profit margin of this Diminishing Musharakah has also been reduced by 100 basis points, for a period of three years from July 2023 to July 2026.
Despite the challenges posed to the Company due to macroeconomic factors, the Company remains committed to maximizing its shareholders’ value and effectively minimizing the impacts of adverse macroeconomic conditions, the filing concluded.
