NFC falls deeper in debt by adding Baht1.8bn '01 net loss

18 March 2002 06:01  [Source: ICIS news]

SINGAPORE (CNI)--Thailand's troubled National Fertiliser Public Co (NFC) has added to its principle debt of Baht8.3bn ($191.5m/Euro217.6m) by posting a net loss of Baht1.8bn for its financial year to 31 December 2001.

The struggling company's net loss increased by 10.6% from Baht1.6bn in its previous year on total sales of Baht3.4bn - down by 22% on the previous year's sales of Baht4.3bn.

Core sales from fertilisers were down 23% to Baht3.2bn, largely due to a government debt moratorium scheme to aid more than 2m farmers and the flood and drought disaster in 2001 which led to lower demand.

Interest payable on the company's debt totaled Baht1.1bn in 2001, up from Baht 753m in 2000, on default rates charged by banks and financial lenders.

Independent auditors Deloitte Touche Tohmatsu have been called in by the Thai Asset Management Corp to try to restructure NFC's debts after local banks Krung Thai and Siam City decided it was too risky to make a loan to the cash-strapped company.

The banks decided it was too risky to go ahead with a Baht900m ($20.6m/Euro23.8m) loan to the company to help it overcome an acute shortage of working capital until after a debt restructuring plan had been agreed.

Deloitte Touche is expected to take at least two months - possibly more - to come up with a debt restructuring plan.

The source said it was not a problem for NFC to struggle through until the new plan was finalised since it had 70 000 tonne of fertiliser in inventory which was worth about Baht1bn.

By: James Dallmeyer
+65 6780 4359

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