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Moody’s upgrades Berlina’s ratings to Baa2.id; stable outlook

Moody's upgrades Berlina's ratings to Baa2.id; stable outlook

Approximately IDR117 billion bonds affected

Jakarta, June 26, 2009 -- PT Moody's Indonesia has today upgraded the 
national scale corporate family and bonds ratings of PT Berlina Tbk 
("Berlina") to Baa2.id from Baa3.id. The ratings outlook is stable.

"The ratings upgrade reflects Berlina's strengthened financial profile 
and also the effective removal of the refinancing risk for its IDR117 
billion bonds which mature in December this year," says Joko Widodo, 
Moody's lead analyst for the company.

After a weak operating performance in FY2006, resulting from the
unfavorable packaging market, Berlina has consistently improved its 
financial profile; the company's ability to manage the cost and 
production efficiency being a key factor in this.

In FY2008, its key credit metrics --as measured by adjusted EBIT margin 
and EBIT/Interest ratio-- improved to 9.7% and 2.3x respectively, from 
5.4% and 0.7x in FY2006. In addition, adjusted Debt to EBITDA 
strengthened to 2.0x from 3.6x during the same period.

Berlina's effective removal of its refinancing risk for the maturing
IDR117 billion bonds --through a 5-year amortization loan arrangement 
with PT Bank CIMB Niaga Tbk six months ahead of the bond maturity-- 
illustrates management's strong commitment to service its debts as 
contractually obligated. The refinancing risk has been a major constraint 
on any positive rating action on Berlina in the last 12 months.

The stable outlook reflects Moody's expectation that Berlina will be able 
to maintain its stable operating performance while pursuing its business 

Positive rating pressures could occur if Berlina consistently complies
with the financial covenants under its loan agreements while at the same
time managing its business growth as planned.

On the other hand, ratings downgrade pressures may occur if Berlina fails 
to execute its business plan thereby affecting its financial profile,
possibly as a result of unexpected adverse changes in the business 
environment. Downgrade pressure could also occur if the company 
undertakes a significant debt-funded expansion without sizable 
corresponding cash flows. Adjusted EBIT margin of below 6-7% and/or 
EBIT/Interest of below 1.0-1.5x would be considered as signs that a 
downgrade could be necessary.

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