South China Morning Post
Wednesday February 10 1999
Debt worry wipes 77pc off Albatronics shares
DENISE TSANG
Shares in Albatronics (Far East), a maker of compact-disc players, tumbled 77.7 per cent yesterday as uncertainties over the fate of the company escalated.
The counter dropped to 3.9 cents soon after the market opened. It was subsequently suspended from trading.
Company secretary Keith Hung Kwok-keung said yesterday Albatronics had yet to finalise an agreement with bank creditors over restructuring its $794 million debt.
Albatronics might be liquidated if no agreement was reached by the end of this month.
"We are optimistic about the agreement, though it is hard to say when we will agree a rescue proposal," Mr Hung said, adding that BNP Prime Peregrine was advising the group on the restructuring.
The financial troubles at Albatronics emerged on Monday when it revealed that $348 million which was payable to eight banks and key trade creditors was overdue.
It said another $223 million would become due to banks and trade creditors on March 6, and the directors expected difficulty settling these payments.
The group's bank facilities have been frozen since December.
Nam Tai Electronics, which controls more than half the group's issued share capital, is unwilling to support the group through a shareholder loan or subscription for new shares, unless successful measures are put in place for the restructuring of debts.
Albatronics' auditor issued a disclaimer to the company's results for the nine months to December due to the continuing fundamental uncertainty in relation to the debt restructuring.
The company made an attributable loss of $529.31 million for the period, against a profit of $22.4 million for the year to December 1997.
Sagging demand due to the regional financial crisis and shrinking margins were blamed for the poor performance. The company made $446.53 million in provisions against items such as its video compact-disc division, inventories, development costs and amounts due from the group's associated companies. |
