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James Debono
Last Thursday Sea Malta’s annual report was presented to its shareholders and it showed a strikingly different picture from that presented by Minister Austin Gatt, For the past months he insisted that Sea Malta’s financial ills were incurable and that privatisation was the way of getting rid of this financial burden. According to the company’s profit and loss account, the Sea Malta group has managed to turn a loss of Lm1,888,171 in 2004 to a profit of Lm276,633 for the year ending 31 March 2005.
The core shipping company has also managed to turn a loss of Lm2,490,598 into a profit of Lm235,764 for the same year.
The company’s turnover has also increased by 9.2 per cent from Lm6 million in 2004 to Lm6,643,782 in 2005 – the group’s entire turnover however decreased from Lm8.1 million to Lm7 million this year.
In an interview published in July, Investments Minister Austin Gatt declared that Sea Malta was impossible to get back on its feet.
“That is the problem. The problem is that since 1997, on average it lost Lm0.5 million every year – profit and loss,” Gatt had told MaltaToday.
Yet this has not been the case this year. Ironically this favourable twist in Sea Malta’s financial fortunes coincided with the government’s decision to sell it.
Although the balance sheet presented in the same report shows a deficit of cumulative losses of Lm4.3 million, these statistics demonstrate that the company is actually recovering.
The Sea Malta group accounts are still in the red mainly due to bank loans accumulated over the past years in the absence of a capital injection on the part of the government. The only capital is the Lm3.2 million the shipping line started off with back in the seventies.
Although debts total some Lm6.5 million in bank borrowings and other creditors, the Sea Malta group accounts show net liabilities have been offset by assets, ending up with a deficit of Lm833,163 in 2005 – in 2004 the figure stood at Lm1.1 million, showing net liabilities have decreased by 25 per cent.
The company’s net liabilities on the other hand decreased from Lm1,018,063 in 2004 to Lm782,299 in 2005.
jdebono@newsworksltd.com
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