Gotianun reported that as one of the creditor-stockholders of VMC, East West Bank feels duty bound to look into the performance of VMC to insure that VMC would be able to meet the repayment of its obligations.
Gotianun had presented to the board of Victorias his analy-sis of the financial performance of Victorias based on the financial statements provided by VMC management. He reported that despite record production and a no financial cost environment under the restructuring agreement, VMC’s performance showed a decrease in profit.
The financial statements showed that earnings before interest and taxes (EBITA) dropped to P93.8 million for the crop year ended August 2002 from P273.9 million of the previous crop year or a drop of 66 percent.
Gotianun recommended to the board that an extensive search for a strong management team with extensive knowledge of the sugar business be conducted. He reiterated that VMC and its stockholders must be vigilant in the selection of the CEO whose main objective is to deliver good corporate governance and insure the payment of its obligations.
Gotianun categorically denied allegations of mismanagement on the part of any particular individual. He said he merely presented the financial figures to the board which showed a deterioration in its ability to raise the cashflow that, in time, will reduce the debt of VMC.
Gotianun said that with an P8-billion debt level, Victorias should be run efficiently, in order to meet its obligations under the restructuring agreement.
Gotianun reiterated that his primary interest is the success of Victorias, which will redound to the benefit of its shareholders, creditors and employees.