Leela reports 173% jump in quarterly loss
Hotel Leelaventure reported a net loss of ~24.4 crore for the quarter-ended September 2017 (Q2), up from a loss of ~8.95 crore in the year-ago period. The loss was despite the company's net sales inching up a bit and operating expenses declining 3.5 per cent year-on-year (yo-y) to ~141.5 crore in Q2.
Like in the year-ago quarter when the company did not provide ~183.5 crore towards finance costs related to its liabilities with asset reconstruction companies (ARCs), it did not provide interest expenses and penalties to the tune of ~206 crore in Q2 of the current financial year. Had it provided for these, the losses would have been higher to that extent, the company said in the notes to the results.
Net sales for the quarter was marginally up at ~158.3 crore, from ~156.9 crore in the year-ago period. The company's operating profit (before other income) came in at ~37.9 crore versus ~32.8 crore in the year-ago period.
The increase in net loss was due to a substantial decline in other income. For Q2, other income stood at negative ~9.14 crore consequent to foreign exchange loss of ~10.6 crore. In the year-ago quarter, the company had reported other income of ~17 crore, led by foreign exchange gain of ~16.6 crore.
The company’s erstwhile corporate debt restructuring (CDR) lenders with exposure of 95.6 per cent of the CDR debt, assigned their debt to JM Financial Asset Reconstruction Company and one lender with exposure of about one per cent of the CDR Debt assigned it to Phoenix ARC on June 30, 2014.
“The company is pursuing with the ARC for a viable restructuring package, with certain concessions in interest and repayment terms and pending approval of the same, has not provided for the interest,” said the company to the exchanges while announcing its results.
“The ARCs have notified the company that the interest and penal interest are applicable as per the rates contracted prior to admission to CDR and the impact of the non-provision is understatement of finance cost for the quarter and half-year to the extent of ~205.95 crore and ~403.29 crore (respectively)," it said.