Business News

Nafta Lendava Group in Financial Troubles

Lendava, 29 December (STA) - The group around the state-owned oil company Nafta Lendava is in big financial trouble, the company's director Cveto Zalik, said at a press conference on Wednesday. The worst results are expected in the biggest subsidiary Nafta Petrochem and in the core company, he noted.

In the January-November period, the group generated EUR 74.5m in revenues, but made a loss of EUR 2.2m, said Zalik, who took over the company in August.

By the end of the year, the loss including all liabilities will amount to around EUR 8m, EUR 6.3m of which only in Nafta Petrochem, he stressed, adding that this could jeopardise the entire group.

Debts have significantly worsened the financial situation in Nafta Lendava and chemicals maker Nafta Petrochem since the second half of 2007, noted Zalik, who believes methanol production in the latter should have been stopped long before July 2010, as it is cheaper in Europe to import methanol.

A restructuring plan for the entire group is being prepared, he said and pointed out that although Nafta Petrochem is in big trouble, the management would do everything it can to resolve the situation.

As the founder, the State Asset Management Agency meanwhile failed to confirm last week the management's report for 2009 and voted against the discharge of the management, ordering instead a new audited report and a restructuring plan for the group.

The group, which employs 442 people, consists of eight companies of which Nafta Lendava, Nafta Petrochem and Eko Nafta will finish the year in the red.

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