Celulosa Argentina, an historic paper mill with more than 100 years of history in Argentina, has entered a critical phase of its existence. After months of idle plants, and a failed debt restructuring, the board of directors decided to file for bankruptcy.
The latest balance sheet figures leave no room for optimism: the company accumulated losses of $172.634 billion, a 44% drop in revenue, a negative EBITDA of $20.146 billion, and a negative net worth of $23.774 billion, leaving it in a situation of technical bankruptcy.
The board of directors acknowledged that “the Company has suffered a significant drop in sales, reaching approximately 52% in the last half year compared to the same period last year.” Overall, domestic sales plummeted 32% in tons, while exports increased 104%, albeit with much lower margins.
The company admitted that “operating costs have increased significantly, especially when measured in dollars, and could not be passed on to prices due to the lack of demand and the threat of imports.” This combination caused a 17% drop in gross profitability and a 31% drop in operating profit, compared to a year earlier when margins were positive at 25% and 14%.
Faced with a lack of liquidity, the company shut down its industrial plants in Capitán Bermúdez (Santa Fe) and Zárate (Buenos Aires), which have remained idle since the end of July. Meanwhile, its Corrientes subsidiary, Forestadora Tapebicuá, also halted production indefinitely, affecting more than 500 workers and forcing the provincial government to provide emergency subsidies.
Celulosa Argentina SA has one pulp manufacturing plant and two paper manufacturing plants. The main products are printing and writing paper, tissue paper, and packaging paper.
Source: Ambito
