1st Jun 2020 11:51
(Alliance News) - South America-focused power generator Rurelec PLC on Monday reported a "disappointing" loss in 2019, with earnings hurt by foreign exchange headwinds and asset write-downs.
In 2019, Rurelec's pretax loss stretched to GBP4.4 million from GBP622,000, on no revenue, like in the year prior.
The company swung to a foreign exchange loss of GBP1.3 million, from a GBP1.7 million gain in 2018. Rurelec also posted write-down of assets totalling GBP2.0 million, against none in the year prior.
Executive Directors Simon Morris and Andy Coveney said: "The loss before tax of GBP4.4 million is disappointing, but is principally driven by foreign exchange losses of GBP1.3 million and a further provision against the carrying value of the 701 turbines of GBP2.0 million."
They added: "The group has started to benefit from being on a more secure financial footing. December 2019 marked the first time since 2008 that the group has received loan repayments due from the holding company of our joint venture operation of GBP500,000."
Rurelec added that the Covid-19 pandemic has had "little impact" on the company so far. Its Energia del Sur project in Argentina is located in a region which has had a very few virus cases, the company explained.
Rurelec said: "Output and profitability to the end of April 2020 are in line with expectations, whilst cash remittances are above forecast for 2020 year to date and higher than for the same period in 2019. Notwithstanding the above, it is not considered possible to estimate the long-term financial impact of Covid-19 on the already-weak Argentinian economy at the present time, nor to anticipate the economic and fiscal measures that the Argentinian government will impose."
Shares in the company were flat at 0.60 pence each in London on Monday morning.
By Eric Cunha; [email protected]
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