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LONDON (Alliance News) - Plaza Centers NV, the London- and Warsaw-listed shopping and entertainment centres developer which is undergoing a debt restructuring, Wednesday reported a net loss of EUR90 million for the most recent quarter, including a EUR71.2 million impairment on properties in India, Romania, Serbia and Poland.
The company said it was putting out an interim update to ensure its shareholders and bondholders have full insight into its financial performance in light of its decision to withhold payment on upcoming bond maturities and approach creditors with a restructuring plan in a formalized restructuring.
It said it had total equity of EUR258 million as at September 30, down from EUR442 million at the end of December last year, while its consolidated cash position was EUR33 million, down from EUR66 million.
"The auditors of Plaza, without qualifying their conclusion on the interim financial information, draw attention to the existence of a material uncertainty that may cast significant doubt about the company's ability to continue as a going concern," it added.
Earlier this month, the company said the Dutch courts had cleared its decision not to repay bonds while it seeks a formal debt restructuring. It has submitted that plan, which includes deferral of payments for three to four years, to the court.
It said that it believes it can continue to trade and eventually pay back its creditors if the plan is approved by the majority of its creditors, warning that a forced liquidation would lead to significant losses for both shareholders and creditors. It is hoping to complete the debt restructuring within six months.
Plaza Centers was hit hard by the economic downturn, a corresponding lack of transactions in property investment markets and a lack of traditional bank financing. It has raised about EUR61 million by selling five assets this year, refinanced debt on some properties and tried to maximise its returns from its remaining assets.
However, this hasn't come quick enough to allow it to meet upcoming bond obligations, including a EUR15 million payment that was due to Polish bondholders on November 18 and a EUR17 million payment due to Israeli bondholders December 31.
Its shares were down 7.1% at 6.50 pence in London Wednesday afternoon.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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