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January 24, 2008 |
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EAST ASIA POWER: 3Q Net Loss Drops 19.8% to PHP189 Mil. in 2007 East Asia Power Resources Corp.'s consolidated net loss for the third quarter has decreased 19.8% in 2007 to PHP189.434 million from 2006's PHP236.204 million. The company and its subsidiaries reported no revenues for the quarter ending September 30, 2007, reporting instead a decreased operating expenses of PHP143.983 million from 2006's PHP428.415 million. The group reported all other charges to be at PHP45.451 million. However, the group's nine-month net loss ballooned to PHP595.681 million in 2007 from 2006's PHP250.119 million. The increase in net loss is brought about by the company's operating cost of PHP504.495 million, which became its operating loss because of the absence of revenues for the period. This is a sharp increase from 2006's PHP39.137 million operating loss for the nine-month period because of a PHP2.104-billion revenue and PHP2.143-million operating cost. All other charges for the January-September 2007 period are at PHP91.186 million. As of September 30, 2007, the group had PHP4.213 billion in total assets and PHP8.832 billion in total liabilities, resulting in a capital deficit of PHP4.618 billion. The company's current liabilities as of September 30, 2007 are at PHP8.318 billion, exceeding its current assets of only PHP658.304 million. The company's third-quarter and nine-month financials for 2007 can be downloaded for free at: http://researcharchives.com/t/s?274a About East Asia Power East Asia Power Resources Corporation was established in 1975 as a mining company under the name Olecram Mining Corporation. It ceased commercial operations as a mining firm after a decade and changed its corporate name to Northwest Holdings & Resources Corporation in 1992. Consequently, the company changed its primary purpose from mining to holdings. In 1996, the company's Board of Directors approved the change of its corporate name to East Asia Power Resources Corporation. East Asia Power operates power generation facilities in Metro Manila, Bataan, Cebu, and Mactan Island, and has interests in a 24 MW coal-fired power plant in Jiangsu Province in the People's Republic of China. In addition to its power plant operations, the company owns 100% of East Asia Power Services, Inc., which offers planning, construction, operation and maintenance consultancy services to other prospective and established power generating facilities. The company also ventured into the transmission and distribution sub-industries of the power sector through the incorporation of a wholly owned subsidiary, East Asia Transmission and Distribution Corporation. Going Concern Doubt Isla Lipana & Co. raised significant doubt on East Asia Power Resources Corporation's ability to continue as a going concern after auditing the company's and it's subsidiaries' consolidated financial results for the fiscal year ended Dec. 31, 2006. Isla Lipana pointed out that East Asia Power and its units -- East Asia Diesel Power Corporation; Duracom Mobile Power Corporation; Sunrise Power Company, Inc.; East Asia Global Management Limited; East Asia Power Services, Inc.; First Electric Utilities Service Corporation; and East Asia Transmission and Distribution Corporation -- have been incurring significant losses and have reported significant capital deficiencies as of Dec. 31, 2006, and 2005. The group is experiencing operational and financial difficulties as indicated by the inability of the remaining operating subsidiaries -- EADPC and DMPC -- to generate sufficient cash flows to meet their obligations and to sustain their operations, and the non- operation of SPCI, EAGML, EAPSI, FEUSC and EATDC whose future business prospects are uncertain. East Asia Power's consolidated balance sheets as of Dec. 31, 2006, showed illiquidity with total current assets of PHP1,175,553,298 and total current liabilities of PHP8,643,284,322. East Asia's total assets as of end-December 2006 was PHP4,632,566,264 and its total liabilities was PHP8,656,366,619, resulting in a capital deficiency of PHP4,023,800,355. The company and its subsidiaries incurred a net loss of PHP595,224,005 for the year ended Dec. 31, 2006 -- or PHP0.167 per share -- on total revenues of PHP2,220,986,371. |
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