APC Group, Inc. - APC Group undertaking capital restructuring

HOLDING FIRM APC GROUP INC., an affiliate of property and gaming firm Belle Corp., is embarking on a quasi-reorganization that aims to halve about P7.7 billion in capital deficit.

Once the capital deficit is addressed, APC plans to expand into geothermal power investments, APC chair Willy Ocier said yesterday.

In a disclosure to the Philippine Stock Exchange, APC said its board had approved the slashing of the par value of the company’s shares which, in turn, would result in the reduction of its accumulated losses by about half.

The PSE implemented a one-hour trading halt on APC starting at 10:30 a.m. Wednesday as it sought additional information on the company’s capital restructuring.

“The new par value and the exact amount of the company’s shares and the exact amount of the resulting reduction in deficit will be decided after further study and consideration,” it said. Retained earnings refer to the portion of net income that is retained by the corporation rather than distributed to its owners as dividends. If the corporation booked a loss, the entry would be retained losses, accumulated losses or accumulated deficit.

APC has booked retained losses in previous years, resulting in a cumulative deficit of about P7.7 billion as of end-2008. It, however, turned profitable in 2009 largely due to the increase in the value of its investment in stocks.

From January to September last year, APC posted a net income of P33.3 million compared to loss of P11.07 million in the same period a year ago.

APC, which has a P535-million balance sheet, has investments in energy-related projects, mining and manpower outsourcing businesses, telecommunications (now a minority shareholder) and a cement project which has been discontinued.

It was actively involved in petroleum trading operations until June 2006 when it shut down this business.

The company has a fully owned subsidiary called Environment and General Services Inc. (EGSI), a company engaged in cleaning and manpower outsourcing services. Other subsidiaries include Aragorn Power and Energy Corp., Aragorn Coal Resources Inc., and APC Mining Corp.

APC also has a minority participation in Philippine Global Communications Inc.

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