MARC Ratings has affirmed its rating on Segi Astana Sdn Bhd’s RM415.0 million ASEAN Green Medium-Term Notes (MTN) at AA-. The rating outlook is stable. Segi Astana is the concessionaire for the integrated complex, gateway@klia2, at the Kuala Lumpur International Airport Terminal 2 (KLIA Terminal 2) in Sepang, Selangor.
The rating affirmation reflects Segi Astana’s stable operating performance, supported by sustained high occupancy at the gateway@klia2 shopping mall, and steady rental collection that generates strong cash flow. The rating also incorporates minimal refinancing risk with the extended concession agreement with Malaysia Airports Holdings Berhad (MAHB) to February 2069, from the original 2036 expiry. Moderating these strengths are the mall’s dependence on passenger traffic volumes at KLIA Terminal 2, which are susceptible to disruptions in air travel demand, as well as tenancy renewal risk.
The outstanding amount under the rated MTN stands at RM195.0 million, with the upcoming scheduled repayment of RM25 million in January 2027 reducing the amount to RM170.0 million. The final MTN repayment of RM170.0 million is due in January 2028, for which Segi Astana is arranging a refinancing facility to be completed by early 2027.
The occupancy level of the mall, which has a net lettable area (NLA) of 379,000 sq ft, remained high at 95.9% as at end-2025 (2024: 96.5%). Rental collection increased to RM98.7 million in 2025 (2024: RM90.6 million), supported by strong tenancy, as reflected by the average turnover rent of RM3.35 psf in 2025, up from RM3.07 psf a year earlier. The average gross rental rate remained stable at RM17.97 psf (2024: RM17.81 psf).
The year 2026 is a major renewal period, with about 214,000 sq ft or 56.5% of tenanted NLA due for renewal. The rating agency understands that over 70% of the occupants have renewed their tenancy for another three years, with the remaining tenancies to be finalised in the coming months. A few tenants, representing about 3%-4% of NLA, have elected not to renew their leases. Nevertheless, replacement tenants have already been secured for the majority of the affected spaces. The tenant mix remains anchored by food and beverage tenants, which accounted for 38% of tenanted NLA as at end-2025, followed by hotels and lounges at 20%, services at 13%, and sports and specialty shops at 8%.
Passenger traffic at KLIA Terminal 2 has remained broadly stable at 27.8 million passengers in 2025, supporting footfall at gateway@klia2. Nonetheless, the pace of growth could be moderated by the geopolitical developments that have caused fuel price volatility and potential airline capacity adjustments. The terminal’s exposure to short-haul domestic and intra-ASEAN travel, which is expected to be less affected, would provide some resilience against the current uncertainties in global aviation.
For 2025, revenue increased by 2.5% y-o-y to RM145.6 million, supported by higher rental, advertising and promotion, and food court income. These were partly offset by lower income from the mall’s car park. Pre-tax profit rose to RM57.2 million from RM50.2 million, while operating profit margin improved to 48.7% from 45.9%. Car park fee collection remained sizeable at RM44.7 million, albeit lower than the RM46.1 million in 2024. Segi Astana’s cash flow generation remained healthy, with cash flow from operations of RM87.8 million in 2025, broadly in line with the RM89.8 million in 2024. CFO interest coverage improved to 6.33x from 5.95x, while free cash flow remained positive at RM72.7 million.