Strategic posts first-half loss
Strategic Finance posted a first-half loss on increased provisioning and bad debts stemming from the downturn in the property and finance sectors.
Wednesday, February 25th 2009, 4:38PM
by Jonathan Underhill
The net loss was $32.8 million in the six months ended December 31, from a year-earlier profit of $14.6 million, the company said in a statement.
The finance company’s auditors reviewed its provisioning for the first half and as a result the company took provisions and debt write-off of $53 million. It also wrote off a $17.2 million deferred tax asset and intangible goodwill of $1.1 million.
The charges stem from “the unprecedented continuing steep decline in the property and finance sector and debt recovery delays affecting SFL’s forecasts,” chief executive Kerry Finnigan said in a statement.
“SFL’s management continues to be focused on maximising recoveries from the orderly realisation of its loan book,” he said.
In December, the company gained approval from debenture and noteholders to its moratorium proposal, which will allow the orderly disposal of its loan book.
Under the plan, Strategic Finance will make quarterly repayments of principal and interest through to December 2013. The moratorium is subject to the company’s ability to raise funds as its assets are realised.
Under the moratorium proposal, interest on investments will be re-set at 8% for all security holders including BOS International.
Strategic froze repayments to 15,000 investors owed $325 million in August.
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