Press Release

JCR-VIS Reaffirms Ratings of Al-Noor Sugar Mills Ltd.

Karachi, August 27, 2012: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the entity ratings of Al-Noor Sugar Mills Limited (ASML) at ‘A-/A-2’ (Single A Minus/A-Two). Outlook on the outstanding ratings is ‘Stable’.

Ratings take into account the diversified operations of the company, through two operating divisions, sugar and medium density fiber board (MDFB). With excess sugar production, the market price of the commodity remained under pressure, resulting in lower margins. Demand for MDFB is considered to be stable; however given the recent price trend, results of the division may also not be able to provide the desired contribution to the bottom line.

Debt levels of the company have been rising for the last two years. In addition to higher short term borrowings to meet working capital requirements, the company has also mobilized additional long term debt. Short term debt is adequately covered by stock. In the absence of price increase going forward, inventory carrying costs may however adversely affect profitability while debt servicing coverage may also come under some stress as the cushion available against long term debt is limited.

For further information on this rating announcement, please contact the undersigned (Ext: 408) or Ms. Sobia Maqbool, CFA (Ext: 604) at 021-35311861-70 (10 lines) or fax to 021-35311873.

Jamal Abbas Zaidi
Deputy CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited VIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2012 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited