Thailand: Energy Earth hashes out fiscal woes

Thailand: Energy Earth hashes out fiscal woes

Beleaguered Energy Earth Plc (EARTH) has clarified to the Stock Exchange of
Thailand (SET) the reasons for the company's submission for business
rehabilitation to the Central Bankruptcy Court.

The need for rehabilitation has impacted the company's credibility and
resulted in a significant decrease in business operations.

Many suppliers have subsequently looked to settle up as the company has
received collection letters from several debtors, which Energy Earth refused
to repay due to a lack of means, the company said in a statement filed to
the SET.

"If our creditors and suppliers proceed with their legal actions against us,
this will cause [Energy Earth] to have liabilities exceeding its assets,"
the statement read.

Prior to the date that the company's board of directors had resolved to
approve the submission [of a business] rehabilitation petition plan to the
Central Bankruptcy Court, Energy Earth's suppliers had initiated legal
action against company for debts in excess of 26 billion baht.

"The company will defend the case in court accordingly," the statement read.

Energy Earth has total assets of 31.8 billion baht and 46.5 billion in total
liabilities.

Of its total debt, 11 billion baht is owed to financial institutions, 5.5
billion stems from bond issuance, 2.4 billion is from bills of exchange, 938
million is for trade accounts payable and other payable.

Moreover, the company owes 1.21 billion for short-term loans offered through
its subsidiaries, while 26 billion is for provisions of contingent
liabilities.

Its remaining debt is for other liabilities, the company said.

The company's clarifying statement is not expected to have much impact as
its business rehabilitation petition has shown that the company has no
financial liquidity and needs to find a solution to recover its business,
said Sukit Udomsirikil, managing director at Maybank Kim Eng Securities
Thailand.

"The statement is probably aimed at ensuring that the company can still
operate its business," said Mr Sukit.

Trade in Energy Earth shares was suspended on June 15 this year because the
company defaulted on 5.5 billion baht in bonds, subsequently affecting the
company's business operations and financial position.

The SET earlier set a deadline on July 27 for Energy Earth to clarify three
key issues after the company filed a petition for business rehabilitation at
the Central Bankruptcy Court.

The three issues that Energy Earth needs to clarify to the SET are: an
explanation for how the company has more liabilities than assets, details of
the debt it has incurred debt based on each group of creditors, and whether
the company has any impaired assets.

The regulator's demand for clarification came after Energy Earth's board of
directors on July 24 approved a resolution to submit a business
rehabilitation petition to the Central Bankruptcy Court.

The Securities and Exchange Commission recently said it would not extend the
period for Energy Earth to file a special audit report, saying further
delays would hurt the company's shareholders.

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

Link to Original Article:
http://www.bangkokpost.com/business/news/1297619/energy-earth-hashes-out-fis
cal-woes

--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com