Kanindotex is still battling<\/p>\n
JAKARTA (JP): The debt repayment of the Central Java-based PT
\nKanindotex needs further rescheduling despite an improvement in
\nits business performance over the past four months.<\/p>\n
Noorbasha Djunaid, who heads the debt-ridden company's new
\nmanagement team, said Kanindotex remains financially weak, even
\nthough the last four months had seen a substantial increase in
\nsales.<\/p>\n
Last September the government appointed the Federation of
\nIndonesian Batik Cooperatives to the position of caretaker
\nmanagement of Kanindotex, reported to be in difficulty regarding
\nits debt of around Rp 500 billion (US$232 million) to two state-
\nowned banks, Bank Bumi Daya and Bank Pembangunan Indonesia
\n(Bapindo).<\/p>\n
The federation's chairman, Noorbasha, was subsequently
\ninstalled as the president of the new management, replacing Robby
\nTjahjadi, the former president and the majority shareholder of
\nthe textile company.<\/p>\n
Noorbasha said on Wednesday that the company's outstanding
\ndebts (loan principal and interest) to the two banks have grown
\nto more than Rp 936 billion, excluding about Rp 70 billion in new
\ndebts incurred by the new management in order to save the company
\nfrom a total collapse during the early stages of the rescue
\nprogram.<\/p>\n
He said that debt repayments should not only be rescheduled
\nbut also restructured, given the fact that most of the debts to
\nthe two state-owned banks carried high interest rates.<\/p>\n
Noorbasha said that the term for repayment of the debts should
\nbe rescheduled to between 15 and 45 years, while their interest
\nrates should be lowered to between five and 15 percent.<\/p>\n
\"If the interest rate on Kanindotex's debts were set at five
\npercent per annum, the repayment would take at least 15 years,\"
\nhe said of the loan rescheduling proposal.<\/p>\n
At present interest payments alone come to about Rp 120
\nbillion, much higher than the company's annual sales of around Rp
\n100 billion, Noorbasha said.<\/p>\n
He said that the new management has been able to double the
\ncompany's yarn output to 800 bales per day and to raise its
\nfabric output by about 25 percent to 250,000 meters per day.<\/p>\n
The increases in the yarn and fabric production have
\nsignificantly raised the company's net sales, which are now Rp
\n115 billion per month, he said, adding that the improvement in
\nproduction performance had resulted in a profit of Rp 24.5
\nbillion over the last four months.(hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kanindotex-is-still-battling-1447893297",
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