Wednesday, 4 February 2015

PSM seeks additional Rs 13 billion

Pakistan Steel Mills (PSM) on Tuesday said its production had grown from 1.4 percent in April 2014 to 30 percent or 1.1 million tons in December-2014 with the help of the government's Rs 18.5 billion Financial Restructuring Package. Giving a break-up, PSM spokesman Shazim Akhtar said, of the total package Rs 8.5 billion were for opening of LCs, Rs 1.5 billion for finished products and Rs 2 billion for raw material.

With the current package, he said PSM's production capacity would reach to breakeven point, 77 percent and in order to sustain and boost the production to 100 percent, 1.1 million tons, the Mills had asked the government for additional Rs 13 billion. It is imperative to mention here that during the last six years the plant has not undergone any capital repair which is the need of the day. Instead of all issues and condition of the plant management is confident and bound to fulfil its commitment and achieve 77 percent production capacity. It is worth mentioning that this amount will not only help achieving 100 percent production, but will also add to asset building of this national enterprise. Moreover, Rs 13 billion will be repaid in couple of years.

It is pertinent to mention that with the help of recent Financial Restructuring Package of Rs 18.5 billion from GoP the loss of Pakistan Steel Mill has been reduced by Rs 9 billion and next year it will further be reduced by Rs 20 billion. In view thereof Rs 18.5 billion and additional Rs 4.5 billion will be paid back in the next two years.

The spokesman further added that Rs 4.5 billion had been requested for payment of three months' salary and utility bills as due to late receipt of iron ore (22nd September 2014) the target was also pushed by three months ie April 2015, and this amount will also be used to pay salary during this extended period. Moreover, (Rs 4.5 billion requested and received amount of Rs 18.5 billion) Rs 23 billion will be repaid in the form of reduced loss by next year.-PR
Copyright Business Recorder, 2015

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