Moody's Raise PGN's Rating To Baa2

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JAKARTA - PT PGN Tbk (PGN) managed to increase the standalone Baseline Credit Assessment (BCA) from baa3 to baa2 from Moody's Ratings (Moody's).

PGN also maintains a consolidated credit rating at the Baa2 level with a Stable Outlook.

In its report, Moody's noted that PGN's "Retained Cash Flow" (RCF) to debt reached 48 percent as of September 30, 2024, an increase from 35 percent in 2022.

This performance exceeds the threshold required for an increase in BCA rankings.

"This increase reflects our expectations that PGN will consistently maintain its financial metric, mainly driven by stable operational and financial performance in line with debt reduction efforts," said Erman Zhang, Moody's Ratings analyst, Thursday, January 16.

PGN Finance Director Fadjar Harianto Widodo added that this increase reflects PGN's consistency in maintaining financial health and stability, supported by successful bond repayment in the second quarter of 2024 and operational performance contributions.

Moody's trust in PGN's financial stability and fundamentals is proof of our commitment to contribute to supporting national energy resilience through innovation, efficiency, and sustainable growth," continued Fadjar.

Faajar emphasized that PGN is committed to continuing a strategic capital expenditure program (capex) with an approach that focuses on optimizing investment.

Priority projects include the development of LNG infrastructure as well as transmission and distribution of natural gas which has a direct impact on increasing company revenues.

Meanwhile, Pertamina's VP of Corporate Communication Fadjar Djoko Santoso added that through this increase in credit ratings, Pertamina is optimistic that PGN's business will grow, and will have a positive impact on national economic growth.

"Priority projects such as gas infrastructure will be the company's focus, where the project is useful in supporting the provision of gas to move industries in Indonesia, achieving self-sufficiency in energy," he explained.