TRIS Rating Assigns “BBB” Rating to Senior Unsecured Debt Worth Up to

TRIS Rating affirms the company rating on JMT Network Services PLC (JMT) at ?BBB? with a ?stable? rating outlook. At the same time, TRIS Rating assigns a ?BBB? rating to JMT?s proposed issue of up to THB500 million senior unsecured debentures due within two years. The company intends to use the proceeds from the proposed debentures issue to fund its operation and refinance its existing debt.

The ratings mainly reflect JMT?s status as a core subsidiary of Jaymart PLC (JMART) (rated ?BBB/Stable? by TRIS Rating). The rating assigned to JMT is equivalent to that assigned to JMART according to TRIS Rating?s ?Group Rating Methodology?. The company plays a vital role in the group?s financial business, which has been the backbone of the group?s diversified operations. The company has been the largest profit contributor among entities within the JMART group. In the first half of 2021, the company?s total revenue and net income accounted for 28% and 70% of JMART?s consolidated total revenue and net income, respectively.

In the first half of 2021 (1H21), JMT?s revenue was THB1.6 billion, up 7% year-on-year (y-o-y). The revenue mix includes 84% from debt acquisition and management business, 10% from debt collection business, and 6% from insurance business. The growth was driven mainly by its debt acquisition and management business. For the first half of 2021, cash collection was THB1,979 million, a 14% YoY increase. The company acquired NPLs worth THB3.3 billion in 1H21 compared to THB 3.5 billion acquired in 2020. The company?s distressed assets had outstanding claim balance of THB215.6 billion from THB207.1 billion at the end of 2020, of which THB49.5 billion were fully amortized, an increase of THB6.3 billion from the end of 2020. The company?s earnings before interest, taxes, depreciation, and amortization (EBITDA) margin rose to 50.4% in 1H21 from 44.7% in 1H20.

RATING OUTLOOK

The ?stable? outlook reflects our expectation that JMT will maintain its status as a core subsidiary of JMART and its distressed debt business continues as a crucial part of the overall group strategy.

RATING SENSITIVITIES

The ratings and/or outlook on JMT moves in tandem with the rating and/or outlook on JMART. A significant weakening of JMT?s group status to JMART could also result in a downward rating change.

RELATED CRITERIA

- Issue Rating Criteria, 15 June 2021

- Group Rating Methodology, 13 January 2021

- Rating Methodology ? Corporate, 26 July 2019

- Key Financial Ratios and Adjustments, 5 September 2018

JMT Network Services PLC (JMT)

Company Rating: BBB

Issue Rating:

Up to THB500 million senior unsecured debentures due within 2 years BBB

Outlook: Stable

TRIS Rating Co., Ltd./www.trisrating.com

Contact: santaya@trisrating.com, Tel: 0-2098-3000/Silom Complex Building, 24th Floor, 191 Silom Road, Bangkok 10500, Thailand

? Copyright 2021, TRIS Rating Co., Ltd. All rights reserved. Any unauthorized use, disclosure, copying, republication, further transmission, dissemination, redistribution, or storing for subsequent use for any purpose, in whole or in part, in any form or manner or by any means whatsoever, by any person, of the credit rating reports or information is prohibited, without the prior written permission of TRIS Rating Co., Ltd. The credit rating is not a statement of fact or a recommendation to buy, sell or hold any debt instruments. It is an expression of opinion regarding credit risks for that instrument or particular company. The opinion expressed in the credit rating does not represent investment or other advice and should therefore not be construed as such. Any rating and information contained in any report written or published by TRIS Rating has been prepared without taking into account any recipient?s particular financial needs, circumstances, knowledge and objectives. Therefore, a recipient should assess the appropriateness of such information before making an investment decision based on this information. Information used for the rating has been obtained by TRIS Rating from the company and other sources believed to be reliable. Therefore, TRIS Rating does not guarantee the accuracy, adequacy, or completeness of any such information and will accept no liability for any loss or damage arising from any inaccuracy, inadequacy or incompleteness. Also, TRIS Rating is not responsible for any errors or omissions, the result obtained from, or any actions taken in reliance upon such information. All methodologies used can be found at

http://www.trisrating.com/en/rating_information/rating_criteria.html.

TRIS Rating Assigns “BBB” Rating to Senior Unsecured Debt Worth Up to THB500 Million of “JMT” with “Stable” Outlook