Russian property developer Sistema-Hals plunged into the red in 2008 with a net loss of $381 mln (EUR 288 mln) compared with a profit of $34.7 mln in 2007, the company said in its unadited financial results. Revenues dropped from $424 mln at end-2007 to $362 mln at year-end 2008. In 2008, operating expenses were up to $486 mln compared to $391 mln in 2007 due to provisions for the Siemens Tower project and impairments of its real estate investments.
Russian property developer Sistema-Hals plunged into the red in 2008 with a net loss of $381 mln (EUR 288 mln) compared with a profit of $34.7 mln in 2007, the company said in its unadited financial results. Revenues dropped from $424 mln at end-2007 to $362 mln at year-end 2008. In 2008, operating expenses were up to $486 mln compared to $391 mln in 2007 due to provisions for the Siemens Tower project and impairments of its real estate investments.
'The real estate and development industry was one of the sectors worst hit by the global financial crisis which had a negative impact on our financial and operational results in the traditionally strong Q4 and therefore in FY 2008,' said Andrei Solovyov, Sistema-Hals CFO. Solovyov added that the liquidity crisis forced the company to adopt a package of anti-crisis measures in December 2008.
'The key measures were a substantial reduction in the development programme and administrative and commercial expenses. Today our next immediate priorities are debt restructuring and raising capital to finance the projects under the adjusted production programme,' he added.
Sistema-Hals said its portfolio has shrunk by 46% to $2.05 bn at end-December 2008 from $3.8 bn in July 2008.
