Gunns expects to record AU$700-AU$800M impairmentAs outlined in its update to the market on 2 July 2012, Gunns Limited has been reviewing its asset values with regard to the analysis it has been undertaking on the impact of the sudden and substantial decline in stumpage prices achieved in the export woodchip market.Although the Company’s analysis is currently incomplete and indefinite, based on analysis undertaken to date, the Company estimates that it will record an impairment in the range from AU$700-800 million in its financial statements for the financial year ended 30 June 2012. The impairment is expected against a range of the Company’s forestry related assets including its Tasmanian land and plantation estate, its interests in Managed Investment Schemes (MIS) and the development costs associated with the Bell Bay Pulp Mill Project (Mill Project). Reflecting this estimated impairment, and subject to end of financial year adjustments, the Company presently expects that its net tangible assets (NTA) value will be in the range of negative AU$50 million to negative AU$150 million as at 30 June 2012 (including FORESTS securities as liabilities of AU$120 million, and otherwise AU$70 million to negative $30 million if FORESTS securities are treated as equity for the purposes of this calculation). For full details on the release this week from Gunns, click here |
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