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FSC clears confusion

Felix Chaudhary
Saturday, January 27, 2018

THE Fiji Sugar Corporation says an article which appeared in The Fiji Times 2017 Year Ender stating that the corporation's government guaranteed loans including explicit liabilities had pushed the miller's liabilities to $963.5 million was done in error.

FSC CEO Graham Clark said combining debt with Government guarantees had given rise to confusion.

He also said the miller had consistently reduced debt over the past two years — and not increased it as the article had suggested.

"We have to distinguish between loans and guarantees," Mr Clark explained.

"FSC's debts have come down year-on-year and not gone up.

"In 2016 it was $390.8 million, in 2017 it went down to $374.5m and as of the end of December last year we are sitting on $324m.

"And that all sits as part of FSC's drive to improve our financials — we are working very hard on all of that.

"The government guarantee is completely separate.

"All the guarantee is, is something we can use to secure or provide security for a loan if we want to.

"In May last year this was increased to $322m and our utilisation of that is less than 24 per cent

"We are not even using the government's guarantee yet because we don't need it.

"We will only need it when we start to raise finance to do big projects. The two are quite separate and must not be mixed up — that has led to confusion."

Mr Clark added that there was also some confusion as to how the government guarantee worked.

"There is no such thing as government money coming to FSC and we use that to do other things.

"It's all FSC money and we either get the money from selling sugar or raising a loan.

"Maybe the loan is from a bank or from India for factory work but it's not from government.

"Government supports us by way of giving a guarantee — that is all.

"So we've started to use the finance available to do a number of things

"We have been doing work in the factories and started to get our equipment fleet organised.

"It's not government money per se. We are utilising government support in a number of cases to raise the money we need for things we need to do."

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