CLSA Pakuwon (PWON IJ) presented during the Investor Day, hosted by IDX from analyst Sarina

Key takeaways:
· Gandaria City Mall in its South Jakarta superblock will open today with GLA of 97,000 sqm. The company said it is 91% leased, with Lotte Mart as one of the anchor tenants. Yield is targeted at 16-17%; ave. rental rate is US$40 psm pm.

· Gandaria Heights condo (2 towers) was 81% pre-sold (priced at Rp18-22m psm). The Gandaria 8 office (36 floors, GLA: 58,370sqm), was 61% presold and leased.

· The company also has 200ha land bank for Pakuwon City township in Surabaya. Land price is now Rp3.3m psm.

· 38% of revenue in 1H10 came from recurring income (Tunjungan Plaza, Sheraton hotel, etc. in Surabaya). The remaining portion was from its sales of condo and office at Gandaria project

· Total debt as of 1H10 is Rp1.5tn with Rp200bn cash; net gearing of 102% (1H09: 121%)

· PWON obtained Rp370bn senior secured notes from CIMB Niaga of 13.5% int pa (30June2010).

· In Oct 2009, PWON restructured its US$110m bond (issued in Nov2006, 12% pa, due Nov2011) to US$19m senior secured notes and US$37m notes (step-up cash coupon and paid-in-kind interest, mature 2015). Moreover, every previous bond-holders who are willing to participate in the exchange, will get an additional US$5 for every US$1,000 old bond. Plus, issuer will add US$20 to the principal of this Note 2015 for every old bond that was exchanged. In Nov 2009, 76% of old bond holders (or eq. US$83m) agreed to the exchange. Step-up cash coupon is 1% for Nov’09-’11, 3% Nov’11-‘12, 5% for Nov’12-13, and 12% for Nov’13-’15. Interest added to notes principal: 11% for the first period, followed by 9%, 7% and 0% for the subsequent periods. Hence this means, the company restructured the debt to push-back payment further to maturity; aiming to preserve more cash for development.