Saudi Cable says accumulated losses reach 63% of capital

Logo of Saudi Cable Co. 

Saudi Cable Co. announced that it will take the required legal procedures after its accumulated losses reached 63.01% of capital, according to a bourse statement.

The company attributed the losses mainly to lower volume in 2021 compared to a year earlier, due to unavailability of the working capital to secure inputs for the production.

The cable producer also cited an increase in the finance cost in 2021 as a result of restructuring some previous debts, as well as a decrease in other sources of income.

In addition, the company allocated provision for the deferred tax associated with a subsidiary in Turkey.

The deadline for the board of directors to invite shareholders for an extraordinary general meeting (EGM) will be April 1, while the deadline for holding the EGM to discuss the accumulated losses will be July 29.

As per Royal Decree on suspending some Clauses of the Companies’ Law, Article No. (2/150) of the Companies’ Law was suspended, which indicates that in case of not holding the EGM within 180 days from the date of notifying the board of directors of the accumulated losses, which will expire on July 29, or if the EGM fails to take a relevant decision, the company will be terminated by the force of the law.

The Tadawul-listed firm invited its shareholders to attend the EGM that will be held on Feb. 9, to vote on a board recommendation of a 27.26% capital cut from SAR 360.61 million to SAR 262.31 million to restructure the company’s capital and offset accumulated losses, Argaam earlier reported.

Shareholders will also vote on a capital hike through SAR 500 million rights issue.