Ever Gotesco seeks more talks on debt restructuring

In a move aimed at ensuring its continued operations, Ever Gotesco Resources & Holdings Inc. (EGRHI) will pursue negotiations with its creditor-banks for the restructuring of its debts.

In a filing with the Securities and Exchange Commission, EGRHI said it will continue to negotiate with lender-banks for "the redemption of foreclosed properties with emphasis on the revenue-generating properties and/or restructuring of collateralized debt obligations."

Company management said it is confident the firm can sustain its operations with the solution to its debt problem.

"The company’s liquidity position is not expected to deteriorate further. The company’s management believes that the liquidity problem is temporary," EGRHI said.

EGRHI, however, reported a decline in its first quarter net profit this year to P913,488 from P9.78 million the previous level. Total rental revenues, for instance, fell five percent to P78.27 million due to the reduction in rental rates of anchor tenants.

The company’s decision to lower its rental rates was intended to retain existing tenant base in view of the continuing effect of the economic crisis.

The drop in revenues was also attributed to lower occupancy rate on rentable spaces and closure of some cinemas.

Net operating costs and expenses increased to P58.7 million from P53.8 million, largely due to rising costs of oil and energy-based items.

To improve its cashflow, EGRHI will expand its mall leasing and operations groups, enhance its marketing strategy and contain costs to minimum levels.

EGRHI will also pursue its relatively aggressive but focused and sustained promotional support to its tenants to strengthen the company’s economic base.