Coltejer Posts Net Loss for 2Q 2021
Medellin-based textile giant Coltejer announced August 17 a COP$14 billion (US$3.6 million) net loss for second quarter (2Q) 2021, down from a COP$724 million (US$187,000) net profit in 2Q 2020.
Gross income likewise plummeted to COP$5 billion (US$1.3 million), from COP$16.3 billion (US$4.2 million) in 2Q 2020 as a result of Coltejer’s shut-down of its money-losing non-woven-fibers production (see Medellin Herald July 16, 2021).
As for first half (1H) 2021, Coltejer posted a COP$40 billion (US$10.3 million) net loss, a slight improvement over the COP$49.8 billion (US$12.9 million) net loss for 1H 2020.
Aside from the usual boilerplate financial information in the latest report, Coltejer made special reference to the ongoing Covid-19 crisis that in prior quarters has bled most industries.
“The outbreak of the Covid-19 pandemic and the measures adopted by the Colombian government to mitigate the spread of the pandemic have significantly impacted the economy,” according to Coltejer.
“Based on the liquidity position of the company as of the authorization date of these financial statements, and the inability to fulfill the commitments acquired with suppliers and employees, the company’s management determined to temporarily suspend the operations of the business of non-woven fibers, which implies for the company a monthly decrease of 49% of current income and a monthly increase in its net loss. With respect to the personnel linked to this line of business, they were granted collective vacations.
“On the other hand, [the company is] seeking liquidity resources for the realization and implementation of technical and market studies through the sale of fixed assets, inventories and leasing of buildings, the implementation of training processes for personnel related to the new technical and market requirements, elaboration of the analysis of the required administrative structure, as well as the definition of job profiles and the analysis of the infrastructure and products required for the market and the analysis of required raw materials and inputs, to avoid shortages.
“In light of these developments, management continues to have a reasonable expectation of having adequate resources to continue in operation for at least the next 12 months and that the ‘going-concern’ accounting base is still adequate, concluding that the company has continuity in the future and that the strategies described above support the possible results that are broken down from this contingency in a controlled way,” Coltejer added.