Deep Sea Supply amends financial statement to reflect larger lossCompany News // April 27, 2016
Deep Sea Supply in Norway has had to amend financial information it issued in February. The company said that compared to the preliminary accounts presented on 19 February 2016, the net result in the financial statements for 2015 has changed from a loss of US$120.51 million to a loss of US$151.39 million.
The reason for the reduced net result is an extraordinary impairment of an investment in the Joint Venture (DESS BTG) of US$30.89 million.
"When assessing the recoverable amount of the investment, the company took into account the going concern uncertainties surrounding DESS BTG, which is in a challenging financial position. The company has allocated a
50 per cent weight to the value of two possible scenarios, one with DESS BTG as a going concern (as accounted for in Q4 financials) and 50 per cent to DESS BTG as a not going concern," Deep Sea Supply said in a statement.
"A 100 per cent allocation to going concern valuations would only be allowed if a formal agreement with lenders has been reached, which was not the case at the time of signing of the financial statements. However, ongoing discussions with the lenders are progressing well and the company is optimistic that an acceptable agreement can be reached that addresses all of DESS BTG's financial challenges."
The financing of DESS BTG is non-recourse to Deep Sea Supply Plc except for a financial guarantee provided in relation to the financing of the vessel Sea Brasil. The board of the company has agreed to present the final audited accounts to the Annual General Meeting on 25 May 2016.