Ariadne $508M in the red

Press, 24 March 1988, Page 31

Ariadne $508M in the red

NZPA-AAP li Hi j * ! II! •' L Brisbane i • i■ J h qikiiJ jk ■ . • h -i| i |uH N u! ■ .[j I< n ; ■ Ariadne Australia yesterday reported a sAustsoB.B6 million net half-year loss in the wake of October’s sharemarket slump that stripped, its investment portfolio to the bone. !

j i • ■ The directors said the [ loss to December 31 came ! after write-offs of sAusts7B.2M most of which represented the i difference ’ between the ' book cost and market [ value of Ariadne’s investi ments. | i [According to an accomi panying letter to, share- [ holders; from .accountants Arthur Andersen and Co. 1 , the | group’s debt at December 31 was ) SAustl.l billion, plus “sig- ■ nif leant! commitments and ■ liabilities.” ■. . I i ’ [The accountants’ letter said this debt will cost the group. sAustlsoM: a year iri interest and other financing ( costs, a charge that cannot be met by cash, flow from Ariadne’s industrial wing — mainly

. Repco; Corporation. ' i“Accordingly, it is essential for Ariadne to sell assets in order to reduce debt fo a level which can be (serviced by retained business activities.” | ' This - sell-off has started : since the December balance date, with total proceeds of about sAustl3sM i excluding the secclnd ! stage sale of Ariadnb’s holding in Giant Re-j-sources to Ampol. ! p|! (Notes ■ accompanying ) the -*• Ariadne accounts | show-. the sAusts7B.2 i million' write-offs include i provision for sAust43. IM [ provided, “to / companies ' outside the group,” alnd the : 1 sAust77.6M book value of the company’s holding in Judge Corpoption, the company associ-

ated with former Ariadne 'chairman, [ Mr Bruce Judge) The directors have requested auditors’ reports (on both these transla'ctions. [[ : [[ Il' ' [. '.’■)! The accounts also show unsecured J loans of sAustg36.lM including sAust3.9M [ due ' from formhr director, Mr Bill Simon. Earner this) week Larry Adler’s FAI Insurarices wbn three 1 seats on the board of Ariadne Australia, including the prizeci position of) nonexecutive j | (chairman, which deposed Mr Judge. Mr.' Adler said! the sharemarket-battered Ariadne | would be I “substantially) restructured) and reorganised)” to try,to res- I tore Queensland’s former number one company to

; financial, and commercial I stability.] ) [| i [' j | FAI,! through its 60 per i cent | subsidiary, Pemi broke ' Securities, earned l the three £eats after I arhassingi a 26.5 per cent interest in Ariadne as underwriter of a rights issue iri the wake of the market crash.) The pre-tax loss was sAustso3.BM against a .sAust97.BsM profit preyiiously.) :|| ; I !. ' || The attributable net loss of sAustsoB.BM compared ) with a $Aust6L3M profit a year earlier, came after a sAust3.l7 million tax expense! [I ■! | The ailing [ group declared ho | interim dividend ' after [paying out Aust4;sc [[ a[ share (9 per cent)! ford the previous first half.