In my February 1, 2010 blog, I talked about Jaya Holdings being interesting after the Courts approved its debt restructing plan.  But no details were available then and I was worried about possible dilution from debt capitalisation.

The company revealed details of the debt restructing last night at an analysts briefing attended by one of our analyst.  The debt restructing plan is very attractive and good for Jaya shareholders.  S$362mn of existing borrowings will be converted into a 5 year secured note in US$.  No principal repayment for the first 2 years and repayments of S$66mn in 2012, S$85mn in 2013 and S$211.6mn in 2014.  Interest is 2.5% above Libor.  There are some dividend restrictions but the conditions were not disclosed.  This deal means no dilution of the company's existing share base from debt capitalisation and also an orderly repayment of the debt.

The Q2-2010 results were good, revenue was up 172% to S$102.7mn with net profit of S$35.3mn higher by 32% from the same quarter in 2009.  For the six months, net profit was S$67.8mn up 89%.  A significant portion of the growth came from interest savings and vessel sales.  Utilisation rate is low at about 50% with the company anticipating and experiening an upturn in business so it has sufficient capacity to meet any pick-up in demand. 

I will let our analyst look at it over the CNY holidays but the stock is definitely worth keeping on the radar screen now the details of the debt restructuring have been revealed.