This is due to non-operational accounting adjustments made to both ebitda and interest expenses in second and third quarter 2024.

Lippo Malls Indonesia Retail Trust (LMIRT) will potentially be unable to meet the minimum interest coverage ratio requirement of 1.5 times as required by the Monetary Authority of Singapore (MAS), it said in a release filed on the bourse on Jan 14. 

LMIRT says that the main factors contributing to its interest coverage ratio falling below the minimum requirement of 1.5 times are non-operational accounting adjustments made to both the ebitda and interest expenses of LMIRT in the 2QFY2024 ended June 30, 2024 and 3QFY2024 ended Sept 30, 2024. 

The manager of LMIRT says that it believes that the aggregate leverage ratio of LMIRT as at Dec 31, 2024 will remain below 50%, or within the aggregate leverage limit. 

It adds that LMIRT’s existing financial debt obligations do not contain any financial covenants with reference to the interest coverage ratio, or the aggregate leverage ratio requirement imposed by the Property Funds Appendix. 

The manager does not expect any negative financial consequences arising from any breaches of such ratios. 

The manager of LMIRT says that it will make the necessary disclosure once information on the actual interest coverage ratio of LMIRT for FY2024 becomes available. 

Units in Lippo Malls Trust closed 0.2 cents higher or 12.5% up at 1.8 cents on Jan 14.