30th Sep 2015 07:59
LONDON (Alliance News) - Power generation company Rurelec PLC saw its shares drop in early trade on Wednesday after it posted a massively wider pretax loss for the first half due to writedowns and impairment charges.
Shares in Rurelec were down 27% to 1.35 pence on Wednesday morning, one of the worst performers in the AIM All-Share.
Rurelec said its pretax loss in the half to the end of June was GBP14.1 million, compared to a GBP1.8 million loss a year earlier. Revenue was marginally higher, up to GBP620,000 against GBP252,000, but the loss was driven by a GBP3.8 million provisional writedown on its Peruvian assets, a GBP2.7 million impairment charge, a GBP3.9 million impairment on loans to its Argentina business and foreign exchange losses of GBP1.6 million.
Rurelec said revenue from its Argentinian business has continued to be solid in local currencies, but the depreciation of the Argentine peso has meant any benefits were offset. The group is now focusing on its South American businesses, having sold-off its IPC engineering business in the half.
"This has not been a satisfactory period for the company and after changing the board of directors we are looking forward to a period where we can restore value to the company and its shareholders through developments in Argentina and Chile, whilst pursuing cost savings at the head office in London and the sale of the Peruvian assets," said Colin Emson, Rurelec's chairman.
By Sam Unsted; [email protected]; @SamUAtAlliance
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