Spain’s debt-laden energy giant Abengoa on Friday posted a 3.7-billion-euro ($4.2-billion) net loss in the first half of 2016, as it seeks to seal a deal with creditors to ward off bankruptcy.
A “general slowdown in business” contributed to the result, the Seville-based group said in a statement.
It had only posted a loss of 340 million euros in the first quarter, while in the first six months of 2015, the group made a 72-million-euro profit.
The world player in solar and wind power, biofuels and water management announced last year that it was filing for preliminary protection from creditors following years of frenzied, unsustainable expansion worldwide.
It has launched a recovery plan that includes the sale of biofuels assets and other non-strategic holdings, as well as job cuts — it has already shed at least 11,000 jobs since the end of last year — and finalised a debt restructuring deal in August.
The group now has until October 25 for creditors and investors to sign off on the deal, which would see it receive a cash injection of 650 million euros on top of loans already granted to the company.
Abengoa’s billions-strong debt has affected many of its projects around the world, which it has either been unable to keep constructing or operating.
In the statement, the group singled out solar power facilities in Chile and South Africa and electricity transmission lines in Brazil.
Its bioenergy sector was particularly hard-hit, with several bioethanol plants in the United States and Europe “paralysed” by bankruptcy proceedings.
The group added that overall turnover reached 1.2 billion euros in the first half of the year, close to three times less than the same time in 2015.
A family-owned company founded 75 years ago, Abengoa rose from being a local electrical firm, fixing installations damaged in Spain’s 1936-1939 civil war, to a major player in solar energy and other renewables.
But risky bets on biofuels and Spain’s cuts to renewable energy subsidies during an economic downturn pushed the company to the edge of bankruptcy.
Source: AFP
