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Bumi plc finds US $152 million of unclear funds usage in BRAU
London-listed Bumi plc said on Friday that it found US$152 million used for unspecified purposes in its Indonesian unit PT Berau Coal Energy (BRAU)
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ondon-listed Bumi plc said on Friday that it found US$152 millionused for unspecified purposes in its Indonesian unit PT Berau Coal Energy(BRAU).
In the long awaited financial report following review by the unit,Bumi plc said that the $152 million was attributed by BRAU's previous management as, among other things, spending on hauling roads and
construction in progress amounting to $79 million, land related payments $42 million and consulting costs of $24 million as well as $5 million for 'goodwill'.
'An extensive review of the financial position of PT Berau (BRAU) was undertaken, which identified expenditure that could not be verified as having a clear business purpose,' Bumi plc said in the announcement available on the company's website.
Bumi plc also said that it booked noncash impairment of BRAU of $815 million.
'With a weakened outlook for thermal coal prices, we have assessed the carrying value of PT Berau and determined that a noncash goodwill impairment of $815 million is required,' it said.
Moreover, it also wrote down $1.39 billion in another unit PT BumiResources (BUMI).
'During the latter part of 2012 the board determined that it was no longer able to apply any significant influence over PT Bumi. It therefore announced that it was necessary to reclassify PT Bumi from an associate to an investment. The income statement records a noncash charge of $1.394 million, which reflects the investment being marked to market at that date to a value of $456 million,' the company said.
Bumi plc ' which is partly owned by politically wired Indonesian conglomerate Bakrie Group - booked $1.53 billion in revenue in 2012, increasing by 8.8 percent compared to reinstated revenue of $1.41 billion in 2011.
Despite the increase in revenue, the company suffered operating losses of $757 million compared to operating profit of $276 million. Its losses before tax stood at $2.41 billion in 2012, a significant setback compared to $119 million in 2011.
