11 February 2013

Namibia: Etale Loses Millions, Needs Another Lifeline

Walvis Bay — Etale Fishing company suffered losses of at least N$66.8 million between April 2011 and December 2012, according to documents availed to New Era.

According to a company insider, the past two years have been particularly very difficult for Etale due to low catches and relatively weak international fish market prices.

"As at 30 April 2011, the company accumulated losses estimated at N$38.8 million. In April 2012 the company's losses stood at N$40 million, while at the end of December 2012 the losses increased to N$66 million," the source revealed.

The source explained that Kefutu Group came on board during May 2012 and when purchasing majority shares of 55 percent inherited a malfunctioning bleeding operation.

A N$20 million lifeline was injected in the company with the intention to rescue it from the financial comatose that imperiled its very existence.

The company then managed to reduce the outstanding levies with the Ministry of Fisheries and Marine Resources and also paid the salaries owed employees for the past five months.

"Despite all these efforts, the business continues to suffer losses and operational challenges largely due to a historic lack of basic and preventative repairs and maintenance to the factory plant and the vessels and an insufficient volume of fishing products landed and processed. This has forced the Board to recommend certain actions in order to realign the business process to ensure an efficient and sustainable operation that will have long-term and secured employment opportunities for our valued employees," said the source.

It is also believed that the company's aging equipment, especially the fish processing installations are in need of extensive replacement/refurbishment.

"The situation has now been exacerbated by the total breakdown of the factory's central refrigeration plant without which the processing and storing of catches has become impossible and all such operations have now come to a standstill," the source said.

The managing director of Etale Fishing, Wilhenchia Uiras late last week released a statement in which she announced the temporary closure of Etale for an "intensive facelift" in order for the company to recover from its woes. Uiras said the shareholders and management would need at least three months to conduct "upgrading".

"The company's assets, in particular the refrigeration and electrical installations require repair, upgrading and rehabilitation," said Uiras.

Etale last week confirmed it had temporarily laid off 700 workers as of Thursday. Further details could not be obtained as the management was locked up in meetings.

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