NEWS

FSC Expects A Turnaround For The 2023 Financial Year

$39 million in total revenue is expected from the sugar proceeds and molasses in the projected financial year.
29 Jul 2022 17:40
FSC Expects A Turnaround For The 2023 Financial Year
Attorney-General and Minister for Economy Aiyaz-Sayed Khaiyum

Previously none of the Fiji Sugar Corporation (FSC) shareholders contributed to the development and assets of the company.

Minister for Economy Aiyaz Sayed-Khaiyum said the corporation was at one time listed under the South Pacific Stock Exchange.

Mr Sayed-Khaiyum said none of these shareholders in fact contributed equity to the development of FSC’s operation and indeed their assets.

“There are still numbers of shareholders that earn shares within the FSC.”

“Management has identified a list of properties that potentially could be divested in order to ensure the efficient running of Fiji Sugar.”

 

He said the corporation had experienced financial issues. This has attributed mainly to various uncontrollable factors ranging from spate of natural disasters, inconsistence of world sugar price and milling in efficiencies resulting from the failed mill upgrade project in 2005.

“Non-renewal of leases, declining in cane production and deteriorating in cane quality have also contributed,” he said.

He said FSC expects a turnaround for the 2023 financial year in which it is anticipating a cane production of two million tonnes and sugar production of around 200,000 tonnes.

 

“A total of $39million in total revenue is expected from the sugar proceeds and molasses in the projected financial year,” he said.

“This projected earnings before interest, tax and depreciation we are expecting a $23.03million.

“FSC is focused on rationalising expenditure with key focus on streamlining controllable expenses, but the focus will not undermine any of the expenditures associated with enhancing the operational performance.”

“Accordingly in order to support the restructure and financial turnaround off FSC it requires additional funding support through government guarantee.”

 

He said through the Financial Management Act 2004 the Government may guarantee the financial liability of any entity in respect of a loan or guarantees.

“The Fijian Government has been guaranteeing FSC domestic and offshore borrowing in the past number of years,” he said.

“The latest domestic guarantee approved by Parliament on 25 May 2017, whereby it approved to increase the existing Government guarantee of $120 million to $322 million.”

 

“It extended the period to 31 May 2022. On the other hand, Government also guarantees FSC offshore borrowings, which was approved on September 15, 2017.

“Whereby Parliament approved the extension of the Government guarantee period for ExIm Bank of India loan of us $50.4 million from 19 2019 to 31 December 2028.”

“Both parliamentary approvals exempted FSC from paying the guarantee fee.”

 

Feedback: jone.salusalu@fijisun.com.fj



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