Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Solid Energy in talks with banks as finances deteriorate

Solid Energy in talks with banks as finances deteriorate

Feb. 21 (BusinessDesk) - Solid Energy, the state-owned coal miner whose chief executive quit this month, is in talks with its banks because of its deteriorating financial position.

The coal miner, which is carrying some $389 million of debt, is heading for a “significant” first half loss, chairman Mark Ford said in a statement.

“We are in discussions with our banks and Treasury on the debt and equity support required for future operations of the business,” Ford said. “A restructuring and turnaround plan for the company is being prepared by the newly appointed board in support of these discussions.”

Don Elder resigned this month after 12 years as CEO, following most of the company’s previous board of directors and hundreds of staff out the door.

In August last year Solid Energy reported a $40 million loss for the year to June 30, the mothballing of the Spring Creek underground coal mine near Greymouth and an end to plans to extend the Huntly East mine in the absence of new contracts with its main customer, the New Zealand Steel mill at Glenbrook.

Writedowns of $151.7 million were included in the result, with further post-balance date writedowns yet to be declared.

Ford said Solid Energy’s performance has also been hampered by weak world coal prices, which touched US$140 a tonne in September, down from US$224 a tonne in June.

“This coal market downturn has resulted in weak prices negatively impacting the company’s operating results for the half year,” he said.

State-Owned Enterprises Minister Tony Ryall said Solid Energy is facing “very significant financial challenges.”

“The new chair and board are focussing on a return to a core coal business which is viable at current world prices,” Ryall said. “The public is aware that there had already been restructuring at the company but more may be required.”

Ryall and Finance Minister Bill English have called a press conference on the matter.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

On For Christmas: KiwiRail Ferries Back In Full Operation After Quake

KiwiRail’s Interislander ferries are back in full operation for the first time since the Kaikoura earthquake, with the railspan that allows rail wagons to be loaded on the Aratere now restored. More>>

ALSO:

Comerce Commission Investigation: Prosecutions Over Steel Mesh Labelling

Steel & Tube Holdings, along with two other companies, will be prosecuted by the Commerce Commission following the regulator's investigation into seismic steel mesh, while Fletcher Building's steel division has been given a warning. More>>

ALSO:

Wine: 20% Of Marlborough Storage Tanks Damaged By Quake

An estimated 20 percent of wine storage tanks in the Marlborough region, the country’s largest wine producing area, have been damaged by the impact of the recent Kaikoura earthquake. More>>

ALSO:

ACC: Levy Recommendations For 2017 – 2019 Period

• For car owners, a 13% reduction in the average Motor Vehicle levy • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy. More>>

Women's Affairs: Government Accepts Recommendations On Pay Equity

The Government will update the Equal Pay Act and amend the Employment Relations Act to implement recommendations of the Joint Working Group on Pay Equity. More>>

ALSO:

Immigration: Increase In Seasonal Workers For RSE

The current cap will be increased by 1,000 from 9,500 to 10,500 RSE workers for the 2016-17 season. Mr Woodhouse says the horticulture and viticulture industry is New Zealand’s fourth largest export industry, producing almost $5 billion in exports. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news