Davao-based businessman — Chelsea cut jobs, sent IOUs as losses bulged to P3.3B

MANILA (AdChoiceTV News) — The logistics group of Davao-based businessman Dennis A. Uy cut jobs, sought mortgage waivers and shed different property other than promoting affiliate 2GO Group Inc. in a bid to keep afloat this COVID-19 pandemic.

In its 2020 annual report, Uy’s Chelsea Logistics & Infrastructure Holdings Corp. stated the pandemic severely disrupted enterprise operations and demand for its companies.

For the full-year, the corporate reported a web lack of P3.3 billion—practically thrice bigger than the earlier 12 months’s lack of P832 million.

Revenues fell 35 p.c to P4.67 billion whereas debt obligations, each short-term and long-term, elevated final 12 months.

By the tip of 2020, Chelsea registered a deficit of P3.37 billion.

The firm’s monetary statements had been ready by administration on a “going concern” foundation, an accounting time period that means it expects enterprise operations to proceed.

But in an hooked up letter, unbiased auditor Punongbayan & Araullo stated this evaluation concerned “significant assumptions, such as forecasted revenues and costs, that are subject to high degree of estimation uncertainty, highlighted by the continuing impact of the COVID-19 pandemic.”

Nevertheless, Chelsea additionally detailed the steps it took to climate the pandemic, saying it anticipated to “recover from its financial and operational risks and impact.”

These measures included money infusions from shareholders, the deferral of capital spending for brand spanking new tasks and renegotiating cost phrases with suppliers.

Cost-cutting measures additionally concerned job cuts affecting 22 p.c of its workforce in 2020, Chelsea stated.

To handle swelling money owed that had been used to finance its speedy enlargement lately, Chelsea stated the group “continued to negotiate with banks to refinance or restructure its existing loans.”

It additionally requested waivers from lenders not to demand quick cost for its loans. This was after the group’s funds fell beneath sure ratios, together with these measuring its means to settle its money owed.

Chelsea stated it has not but acquired any written discover “that the loans are due and demandable, which is provided for in the loan documents as a basis to reclassify the loan to current.”

Chelsea ended the 12 months with complete money owed of P17 billion, up 4.2 p.c. The present portion or these due throughout the subsequent 12 months stood at P6.44 billion.

To additional ease stress on its stability sheet, Chelsea bought final month its practically 32-percent stake in 2GO to SM Investments Corp. and Singaporean fund Trident.

The group additionally bought a vessel, MV Trans-Asia 5, to a 3rd celebration final Jan. 15. It stated two extra vessels could be bought within the subsequent 12 months.

Reporting by Albert Rovic Tan / AdChoiceTV News

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