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Dorchester Posts $35 Mln Loss

Dorchester Posts $35 Mln Loss, Awaits Approval for Payment Plan

By Paul McBeth

Dec. 1 – Dorchester Pacific Ltd. turned to a first-half loss, reflecting a write-off of its stake in ailing finance company St Laurence and an impairment charge against assets.

The net loss was NZ$35 million in the six months ended Sept. 30, from a year-earlier profit of NZ$3 million, the company said in a statement.

Dorchester is awaiting a vote by investors on its proposal to defer repayments. If the proposal failed to win support, Dorchester would likely be placed in receivership, it said. The loss includes NZ$21.3 million to write down them value of its St Laurence to zero and additional provisioning of NZ$11.5 million.

The plan, which was announced on Nov. 11, would give the company three years to repay secured debenture stockholders and unsecured noteholders. Investors would not receive any interest payments, but secured Debenture Stockholders would be part of a 50% profit share payment at the end of the period.

“The deferred repayment plan which if accepted by investors will provide the company with an opportunity to recapitalise and re-establish those businesses which are likely to be profitable in the future,” said chairman Barry Graham.

Shareholder equity plummeted 90% to NZ$6.6 million from NZ$64.4 million, and directors confirmed an interim dividend would not be paid to shareholders.

The company’s stock has fallen almost 80% over the last 12 months to NZ$0.20 per share, and has been as low as NZ$0.06.



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