by Paul McBeth
The financier owned by Doug Somers-Edgar and controversially managed by his Matrix Funding Group posted an operating loss before tax of $3.9 million in the year ended March 31, smaller than the $5.4 million loss a year earlier. The firm turned profitable, posting bottom-line earnings of $1.3 million after a debt restructure gave it an unrealised fair value gain of $6.5 million, which it said will reverse over the new repayment terms.
In August, the firm pushed out its maturity date for all debenture stock by a year to July 31 2012, with interest accruing at a rate of 2% above the 90-day bank bill.
Orange Finance paid $6.3 million to debenture holders after the debt restructure, leaving a carrying value before unrealised adjustments at $19.3 million. It made a further repayment of $425,000 in April.
Auditors Grant Thornton flagged two fundamental uncertainties in its report. The uncertainty in the property market might further impair or delay loan repayments worth $14.1 million. The auditor also noted a loan worth $3.5 million was subject to potential legal action, and may also need to be further impaired.
Orange Finance froze repayments to some 2,500 debenture holders owed $23.2 million at the end of 2008.
Matrix Funding's management fee was $324,000 in the year through March, less than half the $852,000 in the 2009 financial year.
Paul is a staff writer for Good Returns based in Wellington.
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