4th March 1998
FIRST PACIFIC'S DARYA-VARIA RECORDS LOSS IN 1997 AMID FOREX CHARGES
First Pacific Company Limited's Indonesian pharmaceuticals subsidiary, PT Darya-Varia Laboratoria, announced Wednesday that it recorded a net loss in 1997 of IDR100.45 billion, compared with a profit of IDR23.58 billion in the previous year, largely reflecting exceptional charges related to unrealized foreign exchange losses and restructuring provisions for its manufacturing operations.
Before exceptional items, Darya-Varia recorded a pre-tax loss of IDR12.12 billion compared with a pre-tax profit of IDR32.50 billion. However, a provision of IDR31.46 billion was taken for restructuring in connection with the integration of the company's manufacturing activities into a single site. A further charge of IDR56.83 billion was taken for unrealized foreign exchange losses.
Total sales declined by 3 per cent to 197.53 billion amid lower demand caused by the country's economic difficulties, leading to an 8 per cent decline in gross profit to IDR91.49 billion. However, operating expenses grew 65 per cent to IDR85.09 billion as a result of the higher cost in rupiah terms of dollar-denominated inputs, leading to a drop in income from operations to IDR6.41 billion from IDR48.30 billion.
Good progress was made in reducing net trade receivables, which fell to IDR48.72 billion after allowances for doubtful accounts from IDR91.47 billion.
Darya-Varia's Managing Director, Mr Delfin L. Warren, said: "Indonesia's economic difficulties weighed very heavily on our operations, particularly in the second half. The plunging value of the rupiah led directly to an escalation of our operating costs, as more than 80 per cent of our raw materials are imported."
Mr Warren said the company intended to conduct a rights issue to raise approximately IDR200 billion to increase its capital and pay down a substantial portion of foreign debts which total approximately US$45 million. He said First Pacific, which indirectly controls approximately 56 per cent of Darya-Varia, is fully supportive of the issue.
Looking ahead, he said: "Following this cash injection, we have the ability to return quickly to profitability as the economy starts to adjust to new market conditions."
For further information, please contact:
| PT Darya-Varia Laboratoria: | |
| Oscar E. Carag Finance and Administration Director |
Tel: (6221) 725 8005 Web Site: http://www.darya-varia.com |
| First Pacific Company Limited: | |
| Robert Sherbin Group Vice President Corporate Communications |
Tel: (852) 2842 4380 |
First Pacific Company's information can also be accessed on:
| Web Site: |
http://www.firstpacco.com http://www.irasia.com/listco/hk/firstpac |
E-mail: info@firstpac.com.hk |
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